What to Charge an Hour to Make $55,000 a Year
Charge at least
$75.23 per hour
48 weeks, 40 hours a week, 70% of them billable, $36,000 of annual overhead and 10% profit.
How that number is worked out
These are the figures this page was built with and every line the calculator produces from them. Change anything above and all of it moves.
- What you want to earn a year55000 $
- Annual overhead: truck, insurance, phone, office, software36000 $
- Weeks you actually work48
- Hours a week on the tools40
- Percent of those hours you can bill70 %
- Profit on top, as a margin10 %
Charge at least$75.23 per hour
| Hours worked a year | 1,920 |
|---|---|
| Billable hours at 70% | 1,344 |
| Pay plus overhead to cover | $91,000.00 |
| Break even rate | $67.71 /hrat this rate you make zero profit |
| With 10% profit margin | $75.23 /hr |
| Day rate, 8 hours | $601.85 |
| Revenue this implies | $101,111.11 a year |
Billable share of the week compared
Billable percent is the whole game. Nothing else on this page moves the rate as far.
| Billable share of the week | Charge at least | Billable hours at 70% |
|---|---|---|
| 50% | $105.32 per hour | 960 |
| 60% | $87.77 per hour | 1,152 |
| 70% | $75.23 per hour | 1,344 |
| 80% | $65.83 per hour | 1,536 |
| 90% | $58.51 per hour | 1,728 |
What else matters here
Pay of $55,000 plus $36,000 of overhead is $91,000 over 1,344 billable hours, which is $67.71 to break even and $75.23 with profit. That is $601.85 a day and $101,111 of revenue.
The weeks field is the quiet one on this page. Forty eight weeks means four weeks a year not working, and that already covers every public holiday, every sick day and every week the phone does not ring. Nobody is paying you for any of them.
Count honestly and most solo contractors are under 48. Two weeks of vacation, a week of public holidays, a few sick days, a slow stretch in winter and a week lost to weather is eight to ten weeks without trying. At 42 weeks the same $55,000 needs $85.98 an hour instead of $75.23, and that eleven dollar difference is the price of the time off that an employee gets paid for.
What this calculator assumes
- Billable percent is the whole game. Estimating, driving, buying material, chasing payment and answering the phone are all real hours that no customer pays for. 70 percent is optimistic for a one man operation.
- Profit is separate from your pay. Your pay is a cost of the business. Profit is what the business earns for carrying the risk, and it is what funds the next truck.
Questions people ask
What hourly rate do I need to make $55,000 a year?
$75.23 an hour at 1,344 billable hours a year, with $36,000 of overhead and 10 percent profit. Break even is $67.71.
How many weeks a year should I put in?
Count the ones you will actually work. Vacation, public holidays, sick days, weather and slow patches usually add up to more than the four weeks the default allows. At 42 weeks the rate for $55,000 goes from $75.23 to $85.98.
Is my pay the same thing as profit?
No, and mixing them is the most common reason a busy contractor has no money. Your pay is a cost of the business, the same as a wage you would pay somebody else. Profit is what the business earns for carrying the risk, and it is what buys the next truck.
The hourly rate calculator takes any dimensions you like and hands back the same list.