Hourly to Salary Calculator

The basic conversion is annual pay = hourly rate × hours per week × weeks per year. With a standard 40-hour week and 52 paid weeks, that is 2,080 hours, which gives the familiar shortcut: double the hourly rate and add three zeros. $25 an hour is roughly $52,000 a year; $40 an hour is about $83,200.

The shortcut assumes you are paid for every week, including holidays and vacation. If you are a contractor or hourly worker without paid time off, reduce the paid weeks: 50 weeks models two unpaid weeks off, and 48 models a month. Overtime is added at time-and-a-half, which is the federal standard for non-exempt employees working over 40 hours in a week.

A salaried offer and an hourly offer can look similar on paper and be very different in practice. Salaried roles often include paid leave, health insurance, retirement matching and bonuses, which can be worth 20–40% of base pay. Hourly roles may pay overtime that salaried exempt roles don't. Convert both to an annual figure, then add the value of benefits to make a fair comparison.

Freelancers should go further: as a 1099 contractor you pay both halves of Social Security and Medicare, cover your own benefits and have unbilled hours for admin and sales. A common rule is that a freelance hourly rate needs to be 1.5 to 2 times the equivalent employee rate to come out even. Our self-employment tax calculator shows that extra tax cost.

At $25 an hour for 40 hours a week and 52 paid weeks, annual pay is 25 × 40 × 52 = $52,000. That is $4,333 a month, $2,000 per biweekly paycheck, $1,000 a week and $200 a day. With a 20% effective tax rate, take-home is about $41,600 a year. Add five overtime hours per week at $37.50 and annual pay rises by $9,750 to $61,750.