Hourly to Salary Calculator

What an hourly rate becomes over a year

Annual pay from an hourly rate is regular hours times paid weeks times the rate, plus anything overtime adds. At 40 hours a week and 52 paid weeks the regular part is 2,080 hours, which is why so many salary figures divide cleanly by that number.

Take $22.50 an hour. The year is 22.50 x 40 x 52 = $46,800. Divide by 12 for $3,900 a month, by 26 for $1,800 biweekly, or by 52 for $900 a week. Those four numbers describe the same job, and they are the ones a budget, a landlord or a loan officer will ask for.

Biweekly pay is the one people misread. Twenty-six checks of $1,800 is $46,800, but two months a year hold three paydays, which is why a biweekly budget feels easier in those months and tighter in the others.

How this page differs from the salary-to-hourly converters

Most salary pages run backwards. The monthly salary to hourly calculator starts with a monthly figure and divides it down, and the annual salary to hourly calculator starts with a yearly figure and asks which divisor to trust. Both are useful when a job offer arrives as a salary and you want to know what the hours pay.

This page starts at the other end, with the rate on the paycheck, and builds the year up. That direction lets it do two things the reverse pages cannot do cleanly. It adds overtime as a separate line at a separate multiplier, and it lets paid weeks differ from 52 so unpaid summer weeks, school calendars and seasonal shutdowns show up in the total instead of being averaged away. The part time hourly to salary calculator covers the short week case in more depth, including what counts as part time and how benefits change the comparison.

If you already know the yearly figure you want, the last section runs this page in reverse and tells you the hourly rate that target requires at your hours and weeks.

Overtime: time and one-half after 40 hours

Under the Fair Labor Standards Act, covered employees get at least one and one-half times their regular rate for hours over 40 in a workweek, as the Department of Labor fact sheet on overtime states. The workweek is a fixed 168 hour period and it does not have to match the calendar week, which matters for shift workers whose week starts on a Wednesday.

The premium is smaller than it looks. At $22.50 the overtime rate is $33.75, so each overtime hour adds $11.25, not $33.75. Five overtime hours a week for 52 weeks adds 5 x 33.75 x 52 = $8,775, which lifts the year from $46,800 to $55,575.

Those totals assume overtime every week of the year. Four weeks of overtime followed by a quiet month produces a much smaller number, which is why a single busy paycheck is a poor guide to annual pay.

Unpaid weeks and the 52 versus 50 question

Hourly workers are paid for hours worked, so a week off without pay is a week of zero. Teachers, seasonal crews, delivery drivers after a slow January and anyone on a school calendar run into this, and the annual figure has to use paid weeks, not calendar weeks.

Two unpaid weeks turn 52 into 50. At $22.50 and 40 hours that is 22.50 x 40 x 50 = $45,000 instead of $46,800, a drop of $1,800 that has nothing to do with the rate. Four unpaid weeks cost $3,600, and eight cost $7,200. Set the weeks input to the number of weeks you are paid for and the rest of the page follows.

Paid time off is the opposite case. If vacation and holidays are paid, they are part of the 52 weeks and the annual figure already includes them. The distinction is whether the week appears on a paycheck, not whether you were at work.

Reverse mode: the hourly rate a salary target needs

The same arithmetic runs backwards. Divide the target salary by the paid hours the job requires, including overtime hours at their multiplier. At 40 hours and 52 weeks the divisor is 2,080, so a $60,000 target needs 60,000 / 2,080 = $28.85 an hour.

Change the hours and the required rate moves fast. At 32 hours a week the divisor is 1,664 and the same $60,000 needs $36.06 an hour. At 50 paid weeks and 40 hours the divisor is 2,000 and the rate is $30.00. This is the number to quote in a negotiation, because it holds the hours fixed and puts the offer on the same footing as your current job.

The last column is the one that surprises people. A job that pays $24.29 an hour for 45 hours a week, with five of them at time and one-half, reaches the same $60,000 as a 40 hour job at $28.85. The extra hours are paid, but each one is worth less than the rate suggests when you divide the total by all the hours you gave up.

The effective hourly rate when overtime is in the mix

Effective hourly pay is total annual pay divided by total hours worked, overtime hours included. It answers a different question from the base rate: what did each hour of my life pay, on average.

At $22.50 with 10 overtime hours a week, the year is $64,350 across 2,600 hours, which is $24.75 an hour. The base rate looks like $22.50 and the paycheck looks like a 37 percent raise over the no overtime year, but the hours rose 25 percent, so the gain per hour is $2.25.

This is also the honest way to compare a salaried job that expects long weeks with an hourly job that pays overtime. Convert the salary to an effective hourly figure using the hours the salaried role demands, then compare it with the hourly job's effective figure. A $70,000 salary at 55 hours a week is $24.48 an hour across 52 weeks, which is less than $22.50 with steady overtime.

Two cautions. The effective rate ignores commute time, which is unpaid in both cases, and it treats all hours as equally unpleasant, which they are not. Use it as a first filter, not a verdict.

What the gross number leaves out

Every figure on this page is gross pay. Federal income tax, state tax, Social Security and Medicare come out before the money reaches you, and the FICA piece alone is 7.65 percent of wages for most employees, as the IRS explains in Topic 751. On $46,800 that is $3,580, before a dollar of income tax.

Benefits are the other gap. An employer who offers health insurance, a 401(k) match and paid holidays is paying part of your compensation in a form that never appears in the hourly rate. The Bureau of Labor Statistics wage data reports hourly and annual wages for occupations, and it is a reasonable benchmark for the rate itself, but it does not settle what a specific offer is worth to you.

Then there is the cost of showing up. Parking at $12 a day for 250 days is $3,000 a year, which is 6.4 percent of a $46,800 salary. A remote job at $22.50 and an office job at $23.50 can land in the same place once parking, lunches and the extra commute are counted.

This calculator does gross pay arithmetic from the numbers you enter. It is not tax advice, and it does not know your withholding, your state or your deductions.