How to Calculate the Cost of a Meeting: Step by Step

The formula, in one paragraph

How much a meeting costs comes down to four numbers. Multiply the attendees by the loaded hourly rate and by the length in hours for the cost per meeting. Multiply that by the meetings a week for the weekly cost, by 52/12 for the monthly cost, and by 52 for the annual cost. The example is 8 people at $65.00 an hour for 60 minutes, 3 times a week: a $520.00 meeting, $65.00 a person, $8.67 a minute, $1,560.00 a week, $6,760.00 a month, $81,120.00 a year.

Step 1: The loaded hourly rate — the number everyone gets wrong

Start with what one person costs for an hour, and use the loaded rate, not the salary. The loaded rate is salary plus benefits plus overhead — health insurance, payroll taxes, the office, the laptop — and it is typically 1.25 to 1.4 times base pay. The rule of thumb is 1.3 times: someone paid $50.00 an hour costs the company about $65.00 an hour. Use the salary alone and the meeting looks a third cheaper than it is, which is how a $520.00 meeting gets quoted as $400.00. If the room mixes juniors and seniors, use the average loaded rate across the room. The default in the calculator is $65.00 an hour, the loaded cost of a $50.00-an-hour salary. At a $40.00 loaded rate the same meeting costs $320.00; at $120.00 it costs $960.00.

Step 2: The cost of one meeting

Cost per meeting = attendees × hourly rate × (minutes / 60). The minutes over 60 turns the length into hours: 60 minutes is 1 hour, 30 minutes is 0.5 hours, 120 minutes is 2 hours. On the example numbers that is 8 × $65.00 × (60 / 60) = $520.00 a meeting. The cost per person is the hourly rate times the length in hours: $65.00 × 1 = $65.00 — every person in the room costs $65.00 for that hour, whether they speak or not. The cost per minute is the per-meeting cost divided by the minutes: $520.00 / 60 = $8.67 a minute — every extra minute burns $8.67. Halve the people or halve the time and the meeting costs $260.00; double either and it costs $1,040.00.

Step 3: Per week, per month, per year

One meeting is cheap; the habit is expensive. Weekly = per meeting × meetings/week: $520.00 × 3 = $1,560.00 a week. Monthly = weekly × 52/12, because there are 52 weeks in a year and 12 months: $1,560.00 × 52/12 = $6,760.00 a month. Annual = weekly × 52: $1,560.00 × 52 = $81,120.00 a year. The identity to remember is annual = per-meeting cost × meetings/week × 52. Monthly figures are rounded to the cent, so monthly × 12 can differ from the annualised total by a few cents. The frequency is where the money hides: one meeting a week costs $27,040.00 a year, and five meetings a week cost $135,200.00 a year. If you only remember one number from this guide, remember the annual one.

Step 4: Working backwards — the five reverses

Sometimes the question runs the other way: the budget is fixed, and the meeting has to fit it. For a $500.00/meeting budget, the attendees are 8 (exact 7.6923): at 8 the cost is $520.00, $20.00 over, and at 7 it is $455.00, $45.00 under — 8 is the nearest. The minutes for the same $500.00 budget are 58 (exact 57.6923 min): at 58 minutes the cost is $502.67, $2.67 over, and at 57 minutes it is $494.00, $6.00 under — 58 is the nearest. The hourly rate for a $500.00 budget with 8 people is $62.50 exactly. For a $100,000.00 annual budget, the meetings a week are 3.70/wk (exact 3.6982/wk): at 3.70 a week the annual cost is $100,048.00, $48.00 over, and at 3.69 it is $99,777.60, $222.40 under — 3.70 is the nearest. And the attendees for a $100,000.00 annual budget are 10 (exact 9.8619): at 10 the annual cost is $101,400.00, $1,400.00 over, and at 9 it is $91,260.00, $8,740.00 under — 10 is the nearest.

Step 5: What changes the answer

Four things move the answer: the headcount, the rate, the length, and the frequency. The headcount moves it the most in practice: dropping from 20 attendees to 4 cuts the annual cost from $202,800.00 to $40,560.00. The rate moves it next: at $40.00 an hour the annual cost is $49,920.00, and at $120.00 it is $149,760.00. The length moves it the same way: 30 minutes costs $40,560.00 a year, 120 minutes costs $162,240.00 a year. And the frequency moves it silently: one meeting a week is $27,040.00 a year, five are $135,200.00 a year.

What NOT to do

Do not use the salary: the rule is the loaded rate, 1.25 to 1.4 times base pay, 1.3 times as a rule of thumb. Do not count the meeting once: a $520.00 meeting is $81,120.00 a year when it repeats three times a week, and the annual number is the one that matters. Do not forget the room: every extra person costs their full rate for the full length, so an audience of 20 costs $1,300.00 an hour. Do not let the meeting run over: at $8.67 a minute, ten extra minutes cost $86.70, and the overrun repeats every week.

That box is the whole formula.