Home / Freelance Break-Even Rate Calculator

Freelance Break-Even Rate Calculator

Your break-even rate is the lowest price at which you don't lose money. It shows how much work you need just to cover your costs, before you make any profit or savings.

$
Living costs plus business costs you pay each month.
h
%
$

The currency only changes the symbol. No exchange rates are applied.

Your result

How it works

The calculator takes your monthly costs and grosses them up for tax to find the revenue you must earn just to cover them. Dividing by your billable hours gives the break-even hourly rate.

The last figure shows how many hours you would have to bill at your current rate to reach break-even. If it is more than the hours you can actually work, your rate is too low.

Break-even revenue = Monthly costs / (1 - tax rate) Break-even rate = Break-even revenue / Billable hours Hours needed = Break-even revenue / Your current rate

Example

With 3,500 in monthly costs and a 20% tax rate you need 4,375 in revenue. Over 80 billable hours that is a break-even rate of about 54.69, and at a current rate of 40 you would need to bill around 109 hours.

Frequently asked questions

What is the difference between break-even and my target rate?

The break-even rate only covers your costs. Your target rate should also include profit, savings, retirement contributions and a buffer for quiet months. Use the freelance hourly rate calculator for that.

Should I charge my break-even rate?

No. At that price you earn nothing beyond covering costs, and any slow month puts you in the red. Treat it as a floor you should stay well above.

What counts as monthly costs?

Include rent, food, insurance, subscriptions, equipment and anything else you must pay. If you want the business and personal sides separate, add them together here.

What if I can't bill that many hours?

Then raise your rate, lower your costs or find better paying clients. Billable hours are usually fewer than working hours because of admin and sales time.

Related calculators

Freelance Hourly Rate CalculatorWork out the hourly rate you need to hit your income goal after taxes, expenses and unpaid time.Self-Employed Income Goal CalculatorSee the revenue and number of projects you need to reach a monthly take-home goal.Project Pricing CalculatorPrice a fixed-fee project from your hours, rate, safety buffer and expenses, with a deposit amount.

This calculator gives estimates for information only. It is not financial, tax or legal advice, and real-world results depend on your local rules, contract and circumstances.