Freelancer & Creator OS

Calculate rates, estimate taxes, and manage projects with our dedicated tools for the gig economy.

Hourly Rate Engineer

Calculate what you need to charge to survive and thrive.

Minimum Hourly Rate

$0

Includes estimated 30% tax buffer

Quick Tax Estimator

Estimate taxes on a specific gig or invoice.

Est. Income Tax (20%) $0.00
Self-Employment Tax (15.3%) $0.00
What You Keep $0.00

Quick Quote Estimator

Rapidly calculate project fees.

Estimated Total

Excluding tax

$750

Freedom Fund

Plan your "F-you money" runway.

Target: $18,000

27%

You need $13,000 more.

The Ultimate Guide to Freelance Finances: Rates, Taxes, and Contracts

Transitioning from a traditional 9-to-5 to freelancing offers freedom, but it also means you become the CEO, CFO, and janitor of your own business. Understanding the financial mechanics of self-employment is crucial to ensure you aren't just "buying a job" but building a sustainable career.

1. How to Calculate Your Hourly Rate

One of the biggest mistakes new freelancers make is undercharging. You cannot just take your old salary and divide it by 2,080 (40 hours x 52 weeks). Why? Because as a freelancer, you don't work 40 billable hours a week.

The Billable Hours Trap

You spend time on marketing, invoicing, emails, and learning. A realistic freelancer might only bill 20-25 hours a week. The rest is unpaid administrative work. Your rate must cover these non-billable hours.

The "Hidden" Costs

Your rate also needs to cover costs your employer used to pay:

  • Health Insurance
  • Retirement Contributions (no matching!)
  • Paid Time Off (Sick days, holidays)
  • Equipment & Software (Laptop, Adobe CC, etc.)
  • Self-Employment Tax (The extra 7.65%)

2. Navigating Self-Employment Taxes

In the US, employees split FICA taxes (Social Security and Medicare) with their employer. Freelancers pay both halves. This is known as the Self-Employment Tax, and it adds up to 15.3% of your net earnings.

Estimated Quarterly Taxes

Unlike a W-2 job where taxes are withheld from every paycheck, freelancers usually owe taxes quarterly (April, June, September, January). Failing to pay these can result in penalties. A good rule of thumb is to set aside 25-30% of every check into a separate high-yield savings account immediately.

3. Contracts: Your Safety Net

Never start work without a contract. A good contract protects you from:

  • Scope Creep: Clients asking for "just one more small thing" until you've done double the work for the same price.
  • Non-Payment: Clearly outlined payment terms (e.g., Net 15, Net 30) give you legal standing if a client ghosts you.
  • Kill Fees: If a client cancels a project halfway through, you should still be paid for the time you booked or work completed.

Use the Freelancer OS tools above to price yourself correctly from day one. When you treat your freelancing like a business, clients will treat you like a professional.