Hourly Wage to Annual Salary: How to Convert
Whether you are comparing a job offer, building a budget or deciding whether to take a salaried position, the first question is nearly always the same: what does this hourly rate come to in a year? The answer takes one multiplication, but the details, such as unpaid weeks, overtime and taxes, are where estimates go wrong. This guide gives you the formula, a reference table from $15 to $50 an hour and the adjustments that make the number realistic.
The formula
Annual pay = hourly rate × hours per week × weeks per year.
A standard full-time schedule is 40 hours a week and 52 weeks a year, which gives 2,080 hours. That is why most online conversion shortcuts say "multiply your hourly rate by 2,080." For example, $27.50 an hour is $27.50 × 2,080 = $57,200. A useful mental shortcut: double the hourly rate and add three zeros. $25 an hour is roughly $50,000, and the exact figure is $52,000.
The reverse works the same way. To find the hourly equivalent of a salary, divide by 2,080: a $65,000 salary is $31.25 an hour. Use the salary to hourly calculator for a custom schedule.
Hourly to annual salary: $15 to $50 table
| Hourly rate | Weekly | Biweekly | Monthly | Annual |
|---|---|---|---|---|
| $15/hr | $600 | $1,200 | $2,600 | $31,200 |
| $18/hr | $720 | $1,440 | $3,120 | $37,440 |
| $20/hr | $800 | $1,600 | $3,467 | $41,600 |
| $22/hr | $880 | $1,760 | $3,813 | $45,760 |
| $25/hr | $1,000 | $2,000 | $4,333 | $52,000 |
| $28/hr | $1,120 | $2,240 | $4,853 | $58,240 |
| $30/hr | $1,200 | $2,400 | $5,200 | $62,400 |
| $35/hr | $1,400 | $2,800 | $6,067 | $72,800 |
| $40/hr | $1,600 | $3,200 | $6,933 | $83,200 |
| $45/hr | $1,800 | $3,600 | $7,800 | $93,600 |
| $50/hr | $2,000 | $4,000 | $8,667 | $104,000 |
Each rate in the table links to a page with estimated take-home pay by state. Our hourly pages include federal and state taxes, Social Security and Medicare for a single filer, so you can see the difference between gross and net.
Why 2,080 is an approximation
A year has 52 weeks plus one or two extra days, so a pure calendar count gives 2,088 or 2,096 hours in some years. Some employers, including the federal government, use 2,087 hours as the standard year. The result differs by about 0.3%, not enough to affect a decision. If an offer states an annual salary and an hourly equivalent, they probably used one of these; ask which hours assumption is built in.
Adjustments that change the number
Unpaid time off
If you work 50 weeks because you take two unpaid weeks, annual pay falls by two weeks of pay. At $22 an hour, that is $22 × 40 × 2 = $1,760. Seasonal and school-year jobs often work fewer than 52 weeks; use the weeks you actually expect to work in the calculator.
Paid time off and holidays
Paid vacation, sick leave and holidays are paid at your regular rate, so they do not reduce annual pay. They do reduce the hours actually worked, so your effective hourly rate for time on the job is higher. A worker with 15 paid days off and 10 holidays works about 2,080 − 200 = 1,880 hours but is paid for 2,080, an effective rate about 10.6% higher than the stated wage.
Part-time schedules
Use the real hours. A 25-hour week at $18 an hour is $18 × 25 × 52 = $23,400. Remember that part-time jobs may not include benefits, which affects the real comparison with a salaried position.
Overtime
Time-and-a-half for hours beyond 40 can add a large amount of pay. At $20 an hour, five overtime hours a week add $7,800 a year. Our overtime guide covers the rules, and the hourly to salary calculator has an overtime input. Be careful about counting on overtime in a budget; it can disappear when business slows.
Tips, commissions and bonuses
These can be significant but vary. Use a conservative average of the last several months, or the base wage only for planning purposes.
From gross to take-home pay
An annual figure is the starting point, not the amount you spend. Federal income tax, Social Security (6.2%), Medicare (1.45%) and, in most states, state income tax come out of every paycheck. For a single filer taking the standard deduction, take-home pay on common wages looks like this:
| Hourly rate | Gross annual | Take-home (TX) | Take-home (CA) | Effective tax rate (TX) |
|---|---|---|---|---|
| $15/hr | $31,200 | $27,249 | $26,594 | 12.7% |
| $20/hr | $41,600 | $35,606 | $34,411 | 14.4% |
| $25/hr | $52,000 | $43,962 | $42,117 | 15.5% |
| $30/hr | $62,400 | $52,318 | $49,714 | 16.2% |
| $40/hr | $83,200 | $67,361 | $62,772 | 19.0% |
| $50/hr | $104,000 | $81,994 | $75,200 | 21.2% |
Even at modest wages, taxes take a noticeable share, and the share grows as you move up the brackets. Pre-tax retirement contributions or health premiums lower taxable income and make the take-home difference smaller than the contribution itself (see how). To see an exact figure for your state and filing status, use the paycheck calculator.
Common mistakes when converting wages
- Counting overtime that is not guaranteed. Budget on base pay and treat overtime as a bonus unless the schedule requires it.
- Forgetting the gap between gross and net. A $25 hourly wage is $52,000 before tax but a take-home pay of about $43,962 in a state without income tax for a single filer. Rent that looks affordable on the gross can be a stretch on the net; the usual guideline is to keep housing near 30% of gross income, and it is wise to check it against net income too.
- Using the wrong number of weeks. Seasonal and school-based schedules, shutdowns and unpaid leave all reduce the total.
- Comparing hourly rates across different benefits. A wage with employer health insurance may beat a higher wage without it.
- Ignoring state differences. The same wage produces different take-home pay depending on state taxes; see the state paycheck pages.
Daily, weekly and monthly equivalents
Sometimes the useful number is not annual. A full-time worker at $22 an hour earns $176 a day, $880 a week, $1,760 every two weeks and $3,813 on average each month, before tax. Note that monthly pay is an average: with biweekly pay, two months a year contain three paychecks. For monthly bills, plan on the average and treat extra paychecks as savings (see our comparison of biweekly and semimonthly pay).
The same conversion applies for a raise. Moving from $22 to $24 an hour is a 9.1% increase and adds $4,160 a year in gross pay, or roughly $3,343 in take-home pay for a single filer in Texas, because part of the raise goes to taxes. Seeing the net effect is useful when you are negotiating, since an extra dollar an hour is worth less after taxes than it appears on the offer letter.
Comparing hourly and salaried offers
A salaried offer of $62,000 and an hourly offer of $30 an hour look different until you convert them. $30 × 2,080 = $62,400, so the salary is about -$400 higher. But there are other pieces to compare:
- Overtime eligibility. Hourly workers are usually non-exempt and earn premium pay for overtime; many salaried workers do not, even if they work extra hours. If you will regularly work 45 hours a week, the hourly job at $30 could pay $74,100 a year, higher than the salary.
- Benefits. Health insurance premiums, retirement matches, paid leave and bonuses can be worth thousands of dollars.
- Stability and schedule. Hourly hours can fluctuate. A guaranteed 40-hour schedule is worth more than one that is likely to be cut.
- Expected hours. A salaried job requiring 50 hours a week has a lower effective hourly rate than the same salary at 40 hours: $62,000 over 2,600 hours is $23.85 an hour.
Quick conversions to remember
- $15/hr ≈ $31,200 a year
- $20/hr ≈ $41,600 a year
- $25/hr ≈ $52,000 a year
- $30/hr ≈ $62,400 a year
- $40/hr ≈ $83,200 a year
- $50/hr ≈ $104,000 a year
When in doubt, convert both offers to annual pay and to monthly take-home pay, then add the value of benefits. A few minutes of arithmetic can change a decision that affects years of earnings.