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Before a single project earns you a profit, it first has to pay your overhead. The break-even point is where the money coming in finally covers the money going out — and everything after it is profit. Enter your numbers and see how many sales it takes to get there, or the price each sale needs to charge.
Nothing you type leaves your browser. This is a planning estimate, not accounting advice — talk to an accountant about your specifics.
Every business — including a one-person freelance business — has two kinds of cost. Fixed costs are what you pay just to keep the lights on: software subscriptions, insurance, rent, and the salary you want to draw. They don't move when you take on one more project. Variable costs are the ones a project drags in with it: materials, subcontractors, stock photos, payment-processing fees. The gap between your price and the variable cost of one sale is your contribution margin — the slice of each sale that's left over to "contribute" toward the fixed pile.
The logic is just the profit equation set to zero. Profit is revenue − variable costs − fixed costs. At break-even, profit is exactly $0, which means total contribution (sales × margin) has to equal your fixed costs. Solve for the number of sales and you get the first formula; solve for the price instead and you get the second. The calculator above does both and shows the ledger reconciling to a clean $0 profit — proof the number is right.
Say your fixed costs are $4,000 a month (your pay plus overhead), you charge $1,500 a project, and each project costs you $200 in pass-throughs. Your contribution margin is $1,500 − $200 = $1,300 a project, or about 86.7% of the price. Break-even is $4,000 ÷ $1,300 = 3.08 projects a month — call it four, since you can't sell a fraction of a project. Project number four is where the month turns profitable, and every project after it drops $1,300 to your bottom line.
It's tempting to focus on the headline price, but break-even is driven by the margin, not the price. A high price with high variable costs can break even slower than a modest price with almost none. This is also why cutting your price is so dangerous: a small discount comes straight out of the contribution margin, so it can move your break-even point a long way — the same trap the discount calculator spells out in dollars. Raising the margin (charge more, or cut the cost of delivery) is the fastest way to bring break-even closer.
The classic textbook version of this formula counts "units" of a physical product. For a freelancer, a "unit" is usually a project, a client, or a retainer — and your biggest variable cost is often just your time, which doesn't show up as cash. That's fine: enter $0 for variable cost if a project only costs you hours, and the tool treats your whole price as contribution. The real value for service businesses is seeing how few good projects it actually takes to cover a scary-looking fixed-cost number — and how a profit target changes that.
It's the level of sales at which your total income exactly covers your total costs — you make neither a profit nor a loss. Sell one more than that and you start making money; sell one fewer and you're operating at a loss. It's the single most useful number for knowing whether a price or a workload actually works.
Divide your fixed costs by your contribution margin per sale, where the contribution margin is your price minus the variable cost of delivering one sale. For example, $4,000 of fixed costs ÷ a $1,300 margin = about 3.08 projects to break even. Round up, since you can't sell part of a project.
Fixed costs stay the same regardless of how much work you do — software, insurance, rent, your salary. Variable costs only happen because you took a specific job — materials, subcontractors, payment fees, per-project licenses. Splitting them correctly is what makes a break-even number trustworthy.
Switch to the "What price?" mode above. Enter your fixed costs, the number of projects you can realistically take on, and the variable cost per project, and the tool returns the lowest price each project can charge without losing money: (fixed costs + variable cost × projects) ÷ projects.
No. Every calculation runs entirely in your browser — nothing you type is sent to a server or stored. The link in your address bar updates so you can bookmark or share a scenario, but it only contains the numbers and mode you chose.
Keep going
Total your real overhead and the salary you want — that's the fixed-cost number to plug in here.
Build a defensible fixed price for a single project — hours, costs, buffer, and deposit.
Pick the income you want and see how many projects or hours a year it really takes.