Should I Go Freelance?

How this calculator works

Your employer salary isn't the full picture. Benefits like health insurance, retirement match, and paid leave have real dollar value — and as a freelancer, you pay for those yourself. This tool adds salary and benefits together, then divides by your freelance rate to show how many billable hours you'd need each week to break even.

The break-even formula

1. True job value = annual salary + estimated annual benefits value
2. Annual billable hours needed = true job value ÷ your freelance hourly rate
3. Weekly billable hours = annual hours ÷ working weeks (typically 48 after time off)

Compare the weekly number to what you can realistically bill. If you need 28 billable hours/week at 55% billable rate, you're working ~51 hours at your desk — every week.

Worked example

Salary: $75,000. Benefits estimate: $15,000 (health, 401k match, PTO value). True job value: $90,000. Freelance rate: $90/hour (from the rate calculator). Billable hours needed: $90,000 ÷ $90 = 1,000 hours/year = ~21 billable hours/week over 48 weeks.

That can work — but only if you have clients to fill those hours and your rate already accounts for taxes and expenses separately.

What benefits to include

• Employer health insurance contribution ($5,000–$15,000/year in the US)
• Retirement match (often 3–6% of salary)
• Paid vacation and holidays (3–4 weeks of salary value)
• Life, disability, or stock compensation if material

If unsure, use 15–20% of base salary as a benefits estimate for US full-time roles with standard packages.

What this tool does not decide for you

• Income volatility — freelance revenue isn't a steady paycheck
• Pipeline risk — one client leaving can cut income sharply
• Healthcare access and cost in your specific country
• Career growth, autonomy, and quality-of-life tradeoffs

Use break-even as a starting filter, not a resignation letter. Many planners target 120–130% of break-even revenue in year-one projections for buffer.

Common mistakes

• Comparing freelance income to salary only, ignoring benefits
• Using a rate that doesn't include taxes and business expenses
• Assuming you can bill 40 hours/week sustainably
• Treating break-even as guaranteed income from day one

Don't know your freelance rate yet? Use the Rate Calculator first, then plug that number in here. For the full decision framework, read Should You Quit Your Job to Freelance in 2026? and How Many Freelance Hours Replace a Salary.