General
Hourly Rate Calculator
Calculate what you need to charge per hour to hit your income and overhead goals.
You need $80,000 income + $20,000 overhead = $100,000/year. At 75% billable (1500 hrs/year), your breakeven rate is $67/hr. Add 15% profit margin → charge at least $78/hr. If you quote by the job, divide the job hours by this rate to set your floor.
Common Questions
How do I figure out what to charge per hour as a contractor?
Add your desired take-home pay plus your annual business overhead. Divide by the number of billable hours you work each year. Add your profit margin on top. That is your minimum hourly rate.
What counts as overhead for a contractor?
Overhead includes your truck payment and fuel, tools, insurance, phone, license fees, software, and any shop or storage costs. Most solo contractors have $15,000 to $40,000 in annual overhead. Do not forget to include it.
What percentage of my time is billable as a solo contractor?
Most solo contractors bill 60 to 75 percent of their working hours. The rest goes to estimating, driving, buying materials, admin, and unbillable travel. Use 70 percent as a starting point in this calculator.
Why do I need a profit margin on top of my rate?
Your overhead and income calculations get you to breakeven. A profit margin on top lets you save money, invest in equipment, weather slow seasons, and grow your business. Aim for at least 10 to 15 percent profit after all costs.
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