Free tool for agencies and freelancers on monthly retainers
Retainer vs hourly billing calculator
Effective hourly rate = retainer fee ÷ hours used; break-even hours = fee ÷ hourly rate. In the example, a $3,000 retainer for 30 hours with 24 hours used earns $125.00 an hour. Billed hourly at $110, the same 24 hours would be $2,640, so the retainer brings $360 more. Past 27.3 hours a month, hourly billing would earn more.
Last updated 2026-11-12.
- Effective hourly rate of the retainer
- Contracted rate (fee ÷ hours included)
- Same hours billed hourly
- Retainer minus hourly
- Break-even hours
- Retainer discount vs hourly rate
Check the inputs: fee, hours included, hourly rate and hours used all above 0.
Take it with you
Example scenarios
Three sets of example inputs worked through the same formulas as the calculator above. They are illustrations, not averages or statistics.
| Scenario | Inputs | Effective hourly rate | Hourly billing instead | Retainer minus hourly | Break-even hours |
|---|---|---|---|---|---|
| Low | $1,500 for 15 h, 18 h used, hourly rate $110 | $83.33 | $1,980 | -$480 | 13.6 h |
| Typical | $3,000 for 30 h, 24 h used, hourly rate $110 | $125.00 | $2,640 | $360 | 27.3 h |
| High | $6,000 for 60 h, 52 h used, hourly rate $120 | $115.38 | $6,240 | -$240 | 50 h |
Method: Effective hourly rate = retainer fee ÷ hours used; hourly billing = hours used × hourly rate; difference = fee − hourly billing; break-even hours = fee ÷ hourly rate; retainer discount = (hourly rate − fee ÷ hours included) ÷ hourly rate. Figures checked against the same formulas on 2026-11-12.
How the calculator works
A retainer is a fixed monthly fee for a block of hours. Hourly billing charges each hour worked. Enter the fee, the hours included, the rate you would bill by the hour, and the hours the work really took this month.
The calculator shows the contracted rate (fee ÷ hours included), the effective rate (fee ÷ hours used), what the same hours would bill hourly, the difference between the two, the break-even hours where both earn the same (fee ÷ hourly rate), and how much the retainer's contracted rate is below your hourly rate.
Worked example
A client pays $3,000 a month for 30 hours, a contracted rate of $100.00, which is 9.1% below your $110 hourly rate. This month the work took 24 hours, so the retainer earned $125.00 an hour. Billed hourly, the same 24 hours would be $2,640, $360 less than the fee.
Break-even is 3,000 ÷ 110 = 27.3 hours. Below that the retainer earns more than hourly billing; above it, hourly earns more. If the month had taken 40 hours, the effective rate would fall to $75.00 and hourly billing would bring $4,400, $1,400 more than the fee.
Reading the result
One month says little. Enter a few months of hours used, one at a time; if the hours sit above the break-even most months, the retainer is priced too low for the work, or the scope needs an overage rule. If they sit far below, the client may question the value at renewal. Retainers also buy things the hourly comparison leaves out, such as predictable income and reserved time.
What this tool does not do
It compares one month for one client and forgets everything when you close the page. It does not know your contract terms, rollover rules or taxes; it is an estimate, not business advice. For every client at once, the Retainersdesk template linked below shows which retainer is over, close or on track this month.
Questions
Is a retainer better than hourly billing?
It earns more while hours used stay below fee ÷ hourly rate. For $3,000 and $110 that is 27.3 hours a month.
What is the effective hourly rate of a retainer?
The fee divided by the hours actually worked: $3,000 for 24 hours is $125.00.
Does this page store my client numbers?
No. The math runs in your browser; nothing is sent or saved.
Made by Bardach Technologies. We also make Retainersdesk, a separate workspace template for agencies that runs in Notion and shows which client retainer is over, close or on track this month and what is due in the next 7 days (USD 67.99, one-time purchase on Gumroad). Retainersdesk tracks hours used against each client's retainer; it does not compare billing models. This calculator is free and needs no sign-up; nothing is charged on this page. Get Retainersdesk on Gumroad (USD 67.99)