Quoting a day rate is standard practice for consultants, contractors, and anyone billing in blocks rather than hours — but most people back into that number by guessing at a round figure instead of working it out. This calculator starts from the income you actually want to earn this year, folds in what it costs to run your business, and spreads the total across the days you can realistically bill, so the rate it gives you is grounded in your own numbers instead of a competitor's rate card.
How it works
A day rate has to cover more than the day itself. Alongside your target income, your business carries costs — software, insurance, equipment, a coworking desk — that have to come out of what you invoice, not out of your personal budget. And not every day on the calendar is billable: weekends, holidays, vacation, sick time, and the hours spent on proposals, invoicing, and finding the next client all eat into the days you can actually charge a client for.
The calculator adds your annual income target to your business costs, then divides that total by your billable days per year — the number of days you expect to actually bill a client across the whole year. That gives your day rate. The week rate is that day rate scaled to a standard five-day week, and the hour rate divides it across an eight-hour day, both computed from the unrounded day rate so the three figures stay internally consistent even after rounding.
Worked example
Say you want to earn $90,000 this year, you expect 220 billable days, and your business costs run $6,000 a year.
- Revenue to cover: $90,000 + $6,000 = $96,000
- Day rate: $96,000 ÷ 220 = $436.36
- Week rate: $436.3636… × 5 = $2,181.82
- Hour rate: $436.3636… ÷ 8 = $54.55
Notice the week and hour rates come from the unrounded day rate of $436.3636…, not from the rounded $436.36 — that's why $436.36 × 5 looks like it should be $2,181.80 but the calculator reports $2,181.82. It's a cent-level difference, but it's the honest one: rounding twice compounds rounding error, so every output here traces back to a single unrounded calculation.
Two hundred twenty billable days is a reasonably full calendar — it assumes roughly 40 unbillable days a year across holidays, vacation, and admin. Drop that to 180 days for a more conservative estimate, or push it toward 240 if you rarely take time off, and watch how much the day rate moves for the same income target.
How to interpret your result
Treat this figure as the gross revenue you need per billable day, not as take-home pay. Income tax and self-employment tax still come out of it, and so do your personal living expenses — this calculator only separates business costs from your income target, it doesn't touch what the government takes afterward.
It's also a floor, not a market price. If your day rate comes out well above what comparable contractors charge in your field, the fix usually isn't to ignore the number — it's to revisit the inputs. Trim business costs where you can, or check whether your billable-days estimate is too conservative for how you actually work. Conversely, if you're consistently turning down work at this rate, that's a signal the market will bear more than your target implies.
Methodology & sources
The formula is dayRate = (annual income target + business costs) / billable days per year. The week rate is dayRate × 5 and the hour rate is dayRate / 8, both computed from the unrounded day rate before any rounding happens — matching how the day rate itself is derived from unrounded income and cost inputs.
Separating business costs from personal income is standard small-business practice; the U.S. Small Business Administration's guide to calculating startup and running costs is a useful checklist for what belongs in that figure. And because every result here is gross revenue, remember that self-employment tax — a flat 15.3% on net earnings, per the IRS — still comes out of it before it becomes take-home pay.