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//// Business · Freelance

Solo Business Health Score

Rate your freelance business across 6 dimensions — cash flow, rate health, client diversification, tax readiness, retirement, and contract protection. Get your score and top 3 actions.

Where this fits

📈 Investing & WealthGoing 1099Cash FlowFreelancersFounders

This tool lives inside Going 1099 + Cash Flow and is most useful for freelancers and founders.

Corp Tax Rate21%
SE Threshold$400
FICA Cap 2024$168,600
50/100
Developing

Solo Business Health Score

Your business is Developing

Cash flow

+$6,000/mo surplus

Top 3 actions

1.Start making quarterly estimated tax payments to avoid IRS penalties
2.Open a SEP-IRA or Solo 401(k) — soloists can shelter up to $69,000/yr tax-free
3.One client is over 30% of revenue — actively prospect to reduce concentration risk
Cash Flow63
healthy

Build your emergency fund to 3+ months of expenses

Rate Health95
thriving

Keep raising annually to stay ahead of inflation

Client Diversification48
developing

One client is over 30% of revenue — actively prospect to reduce concentration risk

Tax Readiness0
critical

Start making quarterly estimated tax payments to avoid IRS penalties

Retirement Savings10
critical

Open a SEP-IRA or Solo 401(k) — soloists can shelter up to $69,000/yr tax-free

Contract Protection50
developing

Add a kill fee clause (25-50% of remaining contract value) to protect against cancellations

Your numbers

Cash Flow

Average gross income per month

$

Business costs, software, tools, etc.

$

How many months of expenses you have saved

mo

How long clients typically take to pay

Rate Health

Your effective rate for billable work

$/hr

Years of experience as a soloist

yrs

Client Diversification

What % of revenue comes from your biggest client?

%

Tax Readiness

What % of income you expect to owe (0 = don't know)

%

Retirement Savings

Contract Protection

1

Cash Flow score

emergencyFundScore × 0.4 + paymentTermsScore × 0.2 + cashFlowMarginScore × 0.4

Monthly cash flow: $8,000 − $2,000 = $6,000 | Margin: 75.0%

= 63 / 100 (healthy)

Emergency fund depth drives 40% of this score; a 3-month buffer is the minimum target

2

Rate Health score

currentRate ÷ benchmark × scale (0–100), +10 if raised last year

Benchmark: $25 + 3 yrs × $5 = $40/hr | Ratio: 1.88

= 95 / 100 (thriving)

Benchmark is a floor, not a ceiling. Senior soloists often 2–4× above it.

3

Client Diversification score

topClientScore × 0.6 + numClientsScore × 0.4

Top client: 50% of revenue | Active clients: 3

= 48 / 100 (developing)

Revenue concentration above 30% in one client is a single-point-of-failure risk

4

Tax Readiness score

quarterly payments (50) + savings account (30) + rate awareness (20)

Quarterly: 0 | Savings: 0 | Rate known: 0

= 0 / 100 (critical)

Missing quarterly payments triggers a 4-6% IRS underpayment penalty

5

Retirement score

contribution % mapped to 0–100 scale

Contributing: no | Rate: 0% of income

= 10 / 100 (critical)

SEP-IRA allows up to 25% of net SE income (≈$69,000 limit for 2024)

6

Contract Protection score

written contracts (50) + kill fee (25) + deposit (25)

Contracts: 50 | Kill fee: 0 | Deposit: 0

= 50 / 100 (developing)

Each clause independently protects income; all three together is full protection

7

Weighted composite

Σ(dimension_score × weight) ÷ total weight

63 × 25% + 95 × 20% + 48 × 20% + 0 × 15% + 10 × 10% + 50 × 10%

= 50 / 100

Cash flow and rate health carry the most weight (25% and 20%) because they directly determine take-home pay

8

Overall score

weighted composite → badge threshold

50: 0–39 = Critical, 40–59 = Developing, 60–79 = Healthy, 80–100 = Thriving

= 50 → Developing

9

Top priority action

lowest-scoring dimension

Lowest: Tax Readiness (score 0)

= Start making quarterly estimated tax payments to avoid IRS penalties

Improving your weakest dimension yields the highest composite score gain

Key insight

Each of the 6 dimensions is scored 0\u2013100, then combined into a weighted composite. Cash flow and rate health get the most weight because they directly determine your monthly take-home. Fix the lowest-scoring dimension first for the biggest composite gain.

#ShowYourWork

Scores are for self-assessment only — not financial, legal, or tax advice. Results reflect inputs you provide and benchmarks based on common freelance patterns.

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