Last updated: March 2026
How to Convert Hourly Wage to Annual Salary
Whether you're evaluating a job offer, comparing compensation packages, or budgeting for the year, converting between hourly and salary figures is one of the most common financial calculations people need to make. The standard formula is straightforward: multiply your hourly rate by your weekly hours, then multiply by 52 weeks.
For example, $25 per hour at 40 hours per week equals $52,000 per year. But this assumes you work every single week of the year with no unpaid time off. In reality, many hourly workers don't receive paid vacation, so your actual annual earnings may be lower.
The quick shorthand: double your hourly rate and add three zeros. So $30/hour is roughly $60,000. This works because 40 hours times 52 weeks is 2,080 hours, and doubling a number then adding three zeros is the same as multiplying by 2,000 — close enough for a quick mental estimate.
Hourly vs Salary: What Matters Beyond the Numbers
Comparing hourly and salaried positions isn't just about the numbers. Salaried employees often receive benefits worth 25-40% of their base pay: health insurance, retirement contributions, paid time off, and disability coverage. A $50,000 salary with benefits can be worth $65,000-$70,000 in total compensation.
Hourly workers, on the other hand, benefit from overtime protections. Under the Fair Labor Standards Act, non-exempt hourly employees earn 1.5x their regular rate for hours worked beyond 40 per week. A salaried employee earning $52,000 who routinely works 50 hours per week is effectively earning only $20/hour.
Freelancers and contractors should add 25-30% to their target hourly rate to account for self-employment taxes (15.3%), health insurance premiums, retirement savings, and the unpaid time spent on administrative tasks. A $50/hour freelance rate is roughly equivalent to a $35/hour salaried position with benefits.
Understanding Take-Home Pay
Your gross salary and your take-home pay are two very different numbers. The average American keeps about 70-80% of their gross pay after federal income tax, state income tax, Social Security (6.2%), and Medicare (1.45%). Use the tax estimate toggle above to see an approximation for your state.
Keep in mind that these are effective rates, not marginal rates. The U.S. uses a progressive tax system, so only the income within each bracket is taxed at that bracket's rate. A higher salary never results in less take-home pay — you always keep most of each additional dollar earned.
This calculator provides estimates for educational purposes. Tax estimates are approximate and depend on your deductions, filing status, and other factors. Consult a tax professional for personalized advice.
Frequently Asked Questions
How do I convert hourly to salary?
Multiply your hourly rate by the number of hours you work per week, then multiply by 52 (weeks per year). For example, $25/hour x 40 hours/week x 52 weeks = $52,000 per year. If you work fewer than 52 weeks due to unpaid time off, adjust accordingly.
Is $25 an hour a good salary?
At $25/hour working 40 hours per week, you earn $52,000 per year before taxes. Whether this is 'good' depends on your location, cost of living, and lifestyle. It's above the U.S. median hourly wage of approximately $22/hour and comfortable in many mid-cost areas, but may be tight in expensive cities like San Francisco or New York.
How much is $15/hour annually?
$15/hour at 40 hours per week for 52 weeks equals $31,200 per year before taxes. After federal and state taxes, your take-home is typically $25,000-$28,000 depending on your state and filing status.
How do I account for unpaid time off?
Reduce the weeks per year from 52. If you take 2 weeks unpaid vacation, use 50 weeks. At $25/hr, this drops your annual income from $52,000 to $50,000 — a $2,000 difference. Use the time-off slider in this tool to see the exact impact.
What's the difference between gross and net salary?
Gross salary is your total pay before any deductions. Net salary (take-home pay) is what you actually receive after federal tax, state tax, Social Security (6.2%), and Medicare (1.45%) are deducted. Typically, net pay is 70-80% of gross pay depending on your tax bracket and state.