For salaried employees, trying to make a budget for daily and weekly expenses might become a tedious affair. When the salary amount is broken down, it is easier to understand how much liquid money there is in hand for basic expenditure, over a short period of time. For this purpose, it is a smart decision to find the equivalent of your salary in terms of hourly wages. You can do so by first dividing your salary monthly, then weekly, and then finally splitting into the number of hours you work per day. You could also use a financial calculator to make this job simpler for you.
Convert your yearly salary to hourly wage
If you’re looking to figure out how much your hourly wages are from your annual salary, the first thing you need to do is find out how much you work in a week. On an average, a salaried employee works 40 hours a week. We can estimate that an average salaried person works 40 X 52 = 2,080 hours annually.
So, to determine your hourly wage you should divide your annual salary by 2,080. Assuming you make $60,000 annually, your hourly wage would be $60000/2080 which comes to around $28.85. If you work 38 hours a week, divide your annual salary by the hours worked 38 X 52 = 1,976. At $60,000 your exact wages per hour would be $60,000/1,976 = 30.36
Calculating your hourly wages if you’re self-employed
If you want an accurate number, you’re going to need to keep track of how many hours you’ve worked through the period or the project. An easy method to calculate hourly rate would be to calculate it on an annual basis. However, if it needs to be more accurate, you could run calculations for a specific project or a period of time.
You need to update your received paychecks regularly – this can either be project-specific or based on a particular period. The choice to include taxes within the calculation is yours. Not including taxes will mean your hourly rate will appear higher.
The simplest way to find your hourly income would be to divide your income by your hours worked. For example: $10,000/745 = $13.42 per hour.
Overtime wages for salary with fixed hours
If you’re drawing a weekly salary of $500, and the average working hours is 40 in the company you work in, let’s assume that you work for 50 hours this week. Your regular hourly rate would be $500/40 = $12.50. Any hours worked after 40 hours in a week is considered overtime. In this case, it would be 10 hours (50 hours worked – 40 hours average weekly hours).
The overtime rate is usually “hour and a half,” meaning the multiplier would be 1.5. This would be $12.50 X 1.5 = $18.75. Now calculating overtime wages, the number of overtime hours worked multiplied by overtime rate, $18.75 X 10 = $187.50.
Your total weekly wages would be $500 + $187.50 = $687.50