What’s an Hour Worth?

I found several articles about how to set your hourly rate. Many involve elaborate calculations of current living expenses and potential business expenses. The following article at:

http://www.sitepoint.com/article/web-work-should-charge/

made things simple and fairly quick. Basically, you look up the yearly salary that most closely  fits the work you will be performing as a freelancer. They recommend dice.com or salary.com.  Divide the yearly salary by 52 weeks, then by 40 hours to get the hourly rate.

This makes sense to me as a shortcut to the tedious calculation of various and sundry living expenses, at least in my case.  I was already making a salary in the middle of the salary.com bell curve, a salary that was already enough to put food over my head and a roof on the table. What I needed to know was, how to set an hourly rate that would cover those additional business expenses? Legal fees? Additional taxes? Health insurance?  The article offers this shortcut:

Once you have an hourly rate for a salaried employee that does the work you are planning to do on a freelance basis, multiply that number by 1.5 if you plan to work out of your home; if you plan to rent office space, multiply by 2.

The result is a rate that covers both your living expenses and business expenses (“overhead”).  Now it’s time to build in profit so that you have something left after all expenses are paid.  Multiply by 1.15 for a 15% profit, 1.25 for a 25% profit.

So far, this method works for me, someone new to freelancing but with work experience as an employee.  Readers, how do you decide what an hour of your time is worth?