Salary Calculator

How hourly pay converts to salary

This calculator multiplies your hourly wage by your weekly hours to get weekly pay, then by 52 weeks for annual pay. Monthly pay is the annual figure divided by 12, because months average slightly more than four weeks.

At $25 an hour and 40 hours a week, you earn $1,000 a week, $52,000 a year, and about $4,333 a month. A quick shortcut for full-time work is to double the hourly wage and add three zeros: $25 × 2,000 ≈ $50,000. The exact figure uses 2,080 hours (40 × 52).

Gross pay, not take-home pay

The results are gross pay, before taxes and deductions. Federal income tax, Social Security and Medicare (7.65% combined for employees), state and local income tax, and deductions for health insurance or retirement contributions all come out before your paycheck arrives. Depending on your state and benefits, take-home pay is often 20% to 30% lower than gross.

Build your budget on take-home pay. Loan applications and salary comparisons usually use gross pay, so it helps to know both.

Comparing hourly and salaried jobs

The calculator assumes you are paid for all 52 weeks. If you are hourly without paid vacation or holidays, count only the weeks you actually work: 50 weeks at 40 hours is 2,000 paid hours, about $2,000 less a year at $25 an hour.

Overtime changes the math too. Under federal law, non-exempt employees earn 1.5 times their regular rate for hours over 40 in a workweek, so calculate overtime pay separately and add it rather than entering extra hours at the base rate.

When comparing a salaried offer with an hourly one, include benefits such as health insurance, retirement matching, and paid time off, which can be worth thousands of dollars a year.