How many billable hours should I expect?
40 hours/week = 2,080 hours/year. Realistic billable: 1,600-1,800 (75-85%). Rest is sales, admin, training. More experienced = higher billability (up to 90%).
Calculator
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Typical: 1,600-1,800 hours (80% of 2,000)
Business expenses: 25-40% typical
Analysis
Interpretation of the current calculator output
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How to Use
Step-by-step instructions
- 1Enter your desired annual income
- 2Input billable hours per year (typically 1,600-2,000)
- 3Set overhead percentage (typically 25-35%)
- 4Review calculated hourly, daily rates
- 5Compare with market rates for your expertise level
Consulting Rate Formula
Consulting rates must cover desired income, overhead costs, and profit margin. Typical overhead: 20-40%, profit margin: 15-25%.
Hourly Rate = (Desired Income ÷ Billable Hours) × (1 + Overhead % + Profit %)
Daily Rate = Hourly Rate × 8
Monthly Revenue = Hourly Rate × Billable Hours ÷ 12Variables:
Hourly RateRate charged per hourBillable HoursAnnual hours billing clients (~1600)OverheadBusiness expenses as % of revenueProfit MarginTarget profit % (typically 20%)Example
Independent Consultant Example
Inputs:
Desired Income:$100,000/year
Billable Hours:1,600 hours
Overhead:30%
Steps:
- 1.Base rate = $100,000 ÷ 1,600 = $62.50/hour
- 2.Overhead = $62.50 × 30% = $18.75
- 3.Profit (20%) = $62.50 × 20% = $12.50
- 4.Hourly rate = $62.50 + $18.75 + $12.50 = $93.75
- 5.Daily rate = $93.75 × 8 = $750
Result:
$94/hour or $750/day consulting rate
Frequently Asked Questions
What should I include in overhead?
Software, insurance, marketing, website, office/coworking, accounting, legal, conferences, equipment, travel, unbilled time. Typically 25-40% of revenue.
How do I price against competition?
Entry-level: $50-75/hr. Mid-level (3-5 yrs): $75-150/hr. Senior (5-10 yrs): $150-300/hr. Expert (10+ yrs): $300-500/hr. Niche expertise commands premium.