How much do I make an hour?
The hourly rate in your contract and the money a job leaves you for each hour it actually takes are two separate numbers. Enter your salary and contracted hours, then your tax rate, unpaid overtime, commute and the costs of working, and the calculator shows both your official hourly pay and your true hourly wage. Underneath, you can see how much each factor pulls the figure down.
From contract rate to true wage
Your hourly pay after each cost is taken off in turn. The last bar is what an hour of your life really earns.
Your pay for every period
The same job by the hour, day, week, month and year, both on paper and in real terms.
| Period | On paper | Take-home | Real, per hour of your time |
|---|
How the two hourly figures are calculated
The contract rate is salary divided by contracted hours. The true wage is what you keep, divided by every hour the job takes, paid or not.
Hourly pay on paper
The usual conversion: salary divided by contracted hours across all 52 weeks, because paid holidays are paid weeks.
paper rate = salary ÷ (hours × 52)
Pay you take home
Remove tax and payroll deductions.
take-home = salary × (1 − tax rate)
Subtract the costs of working
Money spent only because you have the job.
kept = take-home − work costs × 12
Add up every hour
Contracted hours, unpaid overtime and commuting, over the weeks you actually work.
job hours = (hours + overtime + commute × days) × weeks
True hourly wage
What you keep for every hour the job really uses.
real wage = kept ÷ job hours
Salary and hourly pay FAQ
How do I turn an annual salary into an hourly rate?
Divide the salary by the hours you are paid for in a year. Full time at 40 hours a week for 52 weeks is 2,080 hours, so $52,000 a year comes to $25 an hour. Paid holidays are already included, because those weeks are paid too.
What does "real hourly wage" mean?
It is the amount you truly keep for each hour your job takes. You start with take-home pay after tax and work costs and divide it by every hour the job uses, unpaid overtime and the commute included. For many people it comes out a third or more below the headline rate.
Is it fair to count the commute?
Here, yes. Without the job you would not spend that time travelling, so it is part of the job's cost. That is also how a lower-paid job close to home can beat a better-paid one with a long journey.
Which work costs belong in the calculation?
Anything you only pay because you work: fuel, parking or fares, work clothes, lunches near the office, and childcare during working hours. Leave out spending you would have anyway.
Which tax rate do I enter?
Your overall effective rate, meaning total income tax and payroll deductions divided by gross pay. Your payslip or latest tax return has the figures, and it is normally well below your top bracket.
How much does unpaid overtime cost me?
On a salary, each extra unpaid hour lowers your pay per hour. Five unpaid hours a week on a 40-hour contract cuts your effective rate by roughly 11 percent.