Consulting Rate Calculator

Convert your annual salary with employer benefits to an hourly rate or monthly retainer. This calculator is designed to help you understand what you should be making as a consultant so that your compensation is at least what it would be if you were fully employed.

For more on our methodology, check out our article on Consultant Hourly Rates and Retainers.

A few things to note about this calculator:


  • Employer 401K Matching: One big benefit of being employed is participating in a 401(k) plan that your employer may contribute to it on your behalf. You can find your employer contribution percentage in your 401K plan documents. If your employer matches up to 3% of your salary of let's say $200,000 and you contribute 10%, your employer contribution is $6,000 (3% X $200,000).

    Note: the IRS limits total employer and employee contribution to $69,000 per year for 2024. Employee contribution is limited to $23,000 per year for 2024.
  • Health Benefits: This is the estimated annual amount of your health benefits that you and your employer would pay.  Here are two ways to find this:

    1. If you have a W-2, you would find this in Box 121.  
    2. If you separated from your company and received COBRA paperwork, it will tell you how much you need to pay to keep your insurance benefits.

    If you can't find it, you can use $25,000 as an estimate cost for a family of four.
  • Additional self-employment tax: The self-employment tax rate is 15.3%, which covers federal social security and medicare taxes. If you were employed by a company, this would be similar to a payroll tax where the employer and employee share the cost at 7.65% each. As a consultant, you are responsible for the full cost, so you must add back in the 7.65% that the employer would have paid.
  • Multipliers: you'll need gross up your rate to account for your other costs and time.

    Health Benefits: it can cost 30% more to get health insurance on the open market than through an employer-sponsored plan
    Unbillable time: 20-30% of working hours is spent on business administration, like invoicing, proposals, business development, and more.
    Administrative overhead: 50-100% of gross wages on office space, equipment, tools, etc.

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