How much should you charge for each hour of your work?

Working on your own costs something different in every country: health and pension contributions, taxes and the extra pay employees get (bonuses, 13th salary, extra payments) all change. If you bill foreign clients but live and pay taxes at home, pick your own country to do the math and then convert the result.

It is the base of the whole calculation: any mistake here gets multiplied in the result. Almost everyone who undercharges started by copying someone else's price without knowing what they needed themselves.

It is money for your pocket, after taxes and business costs; those are added separately in the next steps.

You pay these even in a month with no billing. If they are not in your rate, they come out of your personal income.

An employee works in the employer's office. You provide the place, the connection and the power, and that is part of the cost of every hour.

Equipment wears out. If you do not set some aside every month, when it breaks you will have to borrow or drain your savings to replace it. Spreading its value over its useful life turns that big expense into a monthly cost your clients pay.

Payment fees take between 3 and 6% of every international payment. That money never reaches your account, so it has to be inside the price.

A freelancer who does not keep learning or promote themselves loses value over the years. That investment is part of the job and has to come out of what you charge.

It is the total time your billable hours come from. If you enter 60 hours to get a lower rate, the math asks you to work at a pace that ends in burnout or poorly served clients.

As a freelancer, if you do not work you do not get paid. An employee is paid on vacation and when sick; you have to save that money from what you bill the rest of the year.

It is the variable that moves the rate the most. Selling, quoting, unpaid meetings, free support, invoicing, collecting and learning are all work, but no client pays for them directly.

Those hours are covered by the ones you do bill. Going from 60% to 40% raises the rate you need by 50%.

Freelance income is irregular. Without this margin, a month with no projects or a client who pays late forces you into debt, even if your rate "works" on average.

An employee with your same income gets payments on top of the monthly salary. If you want to live the same way, you have to charge for them. They are an extra percentage over your take-home income.

For an employee, the employer pays most of health and pension. You pay all of it out of what you bill, so the rate has to cover it.

Income tax arrives months after you got paid. If you do not set it aside from every payment, you face a big bill right when the money is already spent.

On holidays almost no client works or approves deliveries. Those are days you cannot bill, and they reduce the hours available in the year.