How to Use the Income Calculator
A practical guide for young entrepreneurs planning their freelance IT consulting business in Sweden
Quick Start
The consultant budget calculator helps you answer one critical question: "Can I afford to go freelance?"
Input your hourly rate and billable hours → See your monthly and annual income → Make an informed decision.
Try the Calculator →Why You Need This Calculator
The Problem
You're considering becoming a freelance IT consultant, but you're stuck:
- ❓ How much should I charge per hour?
- ❓ What does that translate to in actual take-home income?
- ❓ Will I earn more than being employed?
- ❓ How do I price myself competitively without undervaluing my skills?
- ❓ Can I actually afford my current lifestyle as a consultant?
The Solution
The calculator helps you:
- Calculate realistic monthly and annual income projections
- Compare consultant income to employee salary equivalents
- Understand the gap between gross income and actual take-home pay
- Make informed pricing decisions based on market data
- Plan your business finances before taking the leap
Step-by-Step Tutorial
1 Find Your Market Rate
How to Research Market Rates
- Visit role-specific pages on Consultant.dev:
- Check job listings directly: Look at 5-10 active job postings in your field. Many list hourly rates or ranges.
- Use experience-based estimates:
- Junior (0-2 years): Typically 600-800 SEK/h
- Regular (2-5 years): Typically 800-1,100 SEK/h
- Senior (5-10 years): Typically 1,100-1,400 SEK/h
- Lead (10+ years): Typically 1,400-1,800 SEK/h
Example: Sarah's Research
Role: Frontend Developer, 3 years experience, Stockholm
Method: Checked 5 job listings on Consultant.dev
Rates found: 850, 900, 950, 920, 880 SEK/h
Average: 900 SEK/h
Sarah's decision: Start at 900 SEK/h, increase to 950 SEK/h after 6 months with proven results
2 Open the Calculator
Visit: consultant.dev/tools/income-calculator-se
💡 Pro tip: Bookmark this page for future reference!
3 Enter Your Hourly Rate
In the "Hourly Rate" field, enter the rate you researched in Step 1.
❌ Common Mistakes
- Entering monthly salary instead of hourly rate
- Using employee salary as hourly rate
- Guessing without market research
- Pricing based on what you "feel" you're worth
✅ Best Practices
- Use actual market data from job postings
- Start conservative, increase with experience
- Consider your specialization value
- Factor in Stockholm premium (10-15% higher)
4 Set Realistic Billable Hours
What are "billable hours"?
Billable hours = Hours you actually invoice clients for. This does NOT include:
- Sales and marketing time (finding clients)
- Administrative work (accounting, invoicing)
- Sick days (you don't get paid when ill)
- Vacation (no paid time off as consultant)
- Learning and skill development
- Gaps between projects
Realistic Billable Hours Expectations
| Scenario | Hours/Month | Why |
|---|---|---|
| Theoretical Maximum | 160h | 40h/week × 4 weeks (rarely sustainable) |
| Realistic Full-Time | 120-150h | Accounts for vacation, admin, sales time |
| First Year Average | 80-120h | Building client base, learning business side |
| Part-Time Consulting | 60-80h | Side income while employed |
First Year Reality Check
Most new consultants don't bill 160h/month from day one. Here's a more realistic ramp-up:
- Months 1-3: 40-80h/month (setup, finding first clients)
- Months 4-6: 80-120h/month (first steady projects)
- Months 7-12: 120-140h/month (consistent pipeline)
- Year 2+: 130-150h/month average (mature business)
Calculator tip: Try multiple scenarios (optimistic 160h, realistic 140h, pessimistic 100h) to see your income range.
5 Understand Your Results
Monthly Gross Income
Formula: Hourly Rate × Billable Hours
Example: 900 SEK/h × 140h = 126,000 SEK/month
⚠️ This is BEFORE taxes! This is what you invoice clients, NOT what you take home.
Annual Gross Income
Formula: Monthly Gross × 12
Example: 126,000 × 12 = 1,512,000 SEK/year
Estimated Net Income
The calculator estimates your after-tax income. This is simplified and actual amounts vary based on:
- Municipal tax rate (varies 29-35% across Sweden)
- Business structure (Eget företag vs Aktiebolag)
- Deductions (equipment, home office, etc.)
- Pension contributions
Sarah's Example (Simplified):
| Gross annual income | 1,512,000 SEK |
| Est. taxes (~32%) | -484,000 SEK |
| Est. expenses (~10%) | -151,000 SEK |
| Est. net income | ~877,000 SEK/year |
| Monthly net (average) | ~73,000 SEK |
Note: This is a simplified estimate. Consult an accountant for accurate calculations.
Typical Consultant Expenses
Set aside 10-15% of gross income for business expenses:
| Expense | Typical Annual Cost |
|---|---|
| Accountant (revisor) | 15,000-30,000 SEK |
| Insurance (liability + income protection) | 8,000-15,000 SEK |
| Self-funded pension | 50,000-150,000 SEK |
| Equipment (laptop, monitor, etc.) | 10,000-30,000 SEK |
| Software and tools | 5,000-20,000 SEK |
| Office/coworking space | 0-60,000 SEK |
| Marketing and networking | 5,000-20,000 SEK |
| Professional development | 10,000-40,000 SEK |
| Total Typical Expenses | 103,000-365,000 SEK |
6 Experiment with Scenarios
The power of the calculator: Try different numbers to see how changes affect your income!
Scenario Planning Examples
Scenario A: Lower Rate, More Hours
Rate: 750 SEK/h
Hours: 160h/month
Monthly gross: 120,000 SEK
Strategy: Easier to get clients, volume-based
Scenario B: Market Rate, Realistic Hours
Rate: 900 SEK/h
Hours: 140h/month
Monthly gross: 126,000 SEK
Strategy: Balanced approach, sustainable
Scenario C: Premium Rate, Selective
Rate: 1,100 SEK/h
Hours: 120h/month
Monthly gross: 132,000 SEK
Strategy: Quality over quantity, more leverage
💡 Key Insight: Small Rate Increases = Big Income Impact
Raising your rate by just 100 SEK/h:
- At 140h/month = +14,000 SEK/month
- Annually = +168,000 SEK/year
Lesson: Don't be afraid to raise your rates as you gain experience!
Comparing Consultant Income to Employee Salary
The calculator shows an "equivalent employee salary" – this helps answer: "Should I take this 52,000 SEK/month job offer or go consultant at 950 SEK/h?"
Rule of Thumb: 2-3x Multiplier
Your consultant hourly rate should be roughly 2-3x your equivalent employee hourly rate.
Why the 2-3x multiplier?
Employee earning 50,000 SEK/month:
- Hourly equivalent: 50,000 ÷ 168h = ~300 SEK/h
- Consultant should charge: 600-900 SEK/h
Why higher as consultant?
- You pay employer taxes yourself (arbetsgivaravgift)
- No paid vacation (need to save for 5+ weeks off)
- No sick pay (no income when ill)
- Self-funded pension and insurance
- Time spent on sales, admin, accounting
- Income gaps between projects
Want a detailed comparison? Contact us for advice on consultant vs employee income comparison.
Frequently Asked Questions
How do I know if my rate is reasonable?
Validate your rate using multiple sources:
- Check market data on our role pages
- Look at 5-10 actual job postings and note the rates
- Ask in communities (r/Sweden, Flashback, LinkedIn groups)
- Use the calculator to see if the resulting income makes sense for your needs
Red flags your rate might be wrong:
- ❌ Way below market average (you'll be seen as inexperienced)
- ❌ Way above market average without specialized skills to justify it
- ❌ Results in lower take-home than employee salary
- ✅ Within 10-20% of market average = reasonable starting point
Should I charge less as a beginner?
Yes, but not too much less.
Good strategy:
- Start at 80-90% of market average for your role
- Increase by 10-15% every 6-12 months as you gain experience
- Reach market rate within 18-24 months
Bad strategy:
- ❌ Charging 50% of market rate ("I'll undercut everyone!")
- ❌ Clients will assume you're low quality
- ❌ Hard to raise rates later
- ❌ You devalue the market for everyone
What if I can't bill 140+ hours consistently?
This is normal, especially in the first year!
Solutions:
- Raise your rate: If you bill 100h at 1,100 SEK/h, you earn the same as 140h at 785 SEK/h
- Build passive income: Create products, courses, or templates you can sell
- Retainer contracts: Negotiate monthly retainers for predictable income
- Multiple clients: Diversify to reduce dependency on single client
- Save during good months: Build 6-month emergency fund for slow periods
Remember: Many successful consultants work 100-120h/month at premium rates rather than 160h at lower rates.
How often should I update my calculations?
Recommended schedule:
- Monthly: Track actual billable hours vs estimate
- Quarterly: Recalculate with actual numbers, adjust rate if needed
- Annually: Major review, plan rate increases, update market research
- Before negotiations: Always recalculate before client discussions
What about taxes? The calculator seems to underestimate them.
You're right to be cautious! The calculator uses simplified estimates (~32% effective tax rate).
Actual tax considerations:
- Municipal tax varies 29-35% depending on where you live
- Eget företag vs AB have different tax structures
- You can deduct business expenses (equipment, home office, travel)
- Pension contributions are tax-deductible
- First-year losses can offset future taxes
❗ Important: Always consult with a qualified accountant (revisor). They can:
- Calculate your exact tax burden
- Recommend optimal business structure
- Identify deductions you're eligible for
- Help with tax planning to minimize burden legally
Next Steps: From Calculator to Reality
You're Ready!
The consultant budget calculator is your planning tool for making one of the biggest career decisions. Use it to model scenarios, understand the financial reality, and make an informed choice.
Remember: The calculator provides estimates to guide your planning. Actual results depend on your skills, effort, market demand, and how well you manage your business.
Important Disclaimer
This guide provides general information and simplified examples for educational purposes. Tax rates, income calculations, and business expenses vary significantly based on individual circumstances. Always consult with qualified professionals (accountant, tax advisor, financial planner) before making business or career decisions. Information presented is based on typical scenarios observed in the Swedish IT consulting market but should not be considered financial, tax, or legal advice.