Freelance Rate vs Full-Time Salary
A freelance rate and a salary aren't the same kind of number. Convert one to the other and see what your rate is really worth — or what it would need to be.
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If your billable hours change
Billable hours per week is the number freelancers most often overestimate. Here's the effect:
| Billable hrs/wk | Equivalent salary |
|---|
How this calculator works
Starting from a rate, we multiply it out by your billable hours and weeks worked to get a gross income, subtract the extra self-employment tax, your own health insurance, and business expenses to get your real take-home — then convert that into the salary a full-time job would need to offer to match it, once you also count the dollar value of paid time off and a retirement match you'd be giving up.
Starting from a salary, we run it the other way: add in the value of insurance, retirement match, and PTO to get its real total worth, then work out the freelance rate you'd need to charge — after taxes, insurance, and expenses — to actually match it, given your billable hours.
Either direction, the key number is billable hours per week — the hours you actually bill a client, not the hours you spend working. Time spent finding clients, writing proposals, invoicing, and following up on late payments doesn't make it onto an invoice, which is exactly why a freelance rate can't be compared to a salaried hourly rate one-to-one.
What this doesn't account for
- Income instability — freelance income varies month to month in a way a steady paycheck doesn't.
- The ongoing work and risk of finding new clients, which a salaried job doesn't require.
- The value of autonomy — setting your own hours and choosing your own projects is worth something to many people.
- Unemployment insurance and paid sick leave, which freelancers typically don't have access to.
Frequently Asked Questions
How is a freelance rate converted to a salary equivalent?
We calculate your effective annual income from the freelance rate (hourly or daily × billable hours per year), then subtract self-employment taxes, health insurance, retirement contributions you'd have to fund yourself, and the cost of unpaid time (vacation, sick days, gaps between contracts). The result is what freelancing actually puts in your pocket compared to a salary.
What benefits should I account for as a freelancer?
The main items are: health insurance (employer plans are often worth $5,000–$20,000 per year in employer contribution), retirement matching you'd miss, paid vacation and sick days, and any other perks the full-time offer includes. Freelancers also pay self-employment tax (15.3%) on top of income tax.
How does unpaid time affect the comparison?
Unlike a salaried employee, a freelancer only earns when billing. Time off, gaps between clients, and administrative overhead all reduce effective income. If you work 48 billable weeks per year instead of 52, your effective rate is about 8% lower than your nominal hourly rate suggests.
What freelance rate should someone target to match a given salary?
As a rough rule: multiply the target annual salary by 1.5–2× to estimate the gross freelance rate needed. The multiplier covers self-employment taxes, benefits, unpaid time, and overhead. The calculator gives you a more precise figure based on your specific inputs.