Calculators

Financial

Personal Finance

Calculator Use

See how your hourly pay rate matches up as an annual salary. This calculator converts your hourly wage to annual pay. Enter your hourly wages, hours worked per week and weeks worked per year to find what you earn on a yearly basis. If you regularly work overtime include those hours to accurately calculate your annual salary.

How to Calculate Annual Salary from Hourly Pay Rate

Use this formula and follow the steps to convert hourly rate to annual salary:

Annual Salary = Hourly Rate × Hours Worked per Year

1. Find hours worked per year. Multiply hours worked per week by the number of weeks worked per year.
2. Multiply your hourly pay rate by hours worked per year to get your equivalent annual salary.

Example Calculation: Hourly to Salary

Say your current pay rate is $28.00 per hour. You get two weeks of paid vacation, so although you only work 50 weeks per year, you get paid for 52 weeks per year.

Using the formula and the steps above, first find how many hours you are paid per year. Then multiply your hourly pay by that total number of hours.

1. Find hours worked per year: 40 hours per week × 52 weeks per year = 2080 paid hours per year
2. Find annual salary rate equivalent to your total annual hourly pay: $28.00 × 2080 = $58,240 per year

If you are looking to change jobs and you want an increase in pay, make sure your new annual salary is more than your current hourly-to-salary pay equivalent of $58,240 per year. Be sure to note whether your new salary will include paid time off. If it does not, you'll be stretching your salary across a whole year, including the hours you don't work. So effectively your salary would be worth less than face value since you work to support yourself for the entire year.

Calculated Salary vs. Effective Salary

Calculated Salary

Your calculated salary is your hourly rate multiplied by hours worked per week and the number of weeks you actually work. The calculation can include overtime and double time if that applies to you, but it does not include paid time off or PTO.

Effective Salary

Your effective salary includes paid time off like vacation, holidays or personal time off. Since you are paid for this time off your salary effectively "increases" because you are paid even though you don’t work those hours. Essentially you are paid for more hours than you work given your annual salary.

Your effective salary is important to know if you are comparing hourly and salaried positions. The effective salary is the amount you want to receive per year for your compensation to remain equal to your total annual hourly compensation.

Hourly to Salary Formulas

Salary equals hourly rate times number of hours per week times number of weeks per year.

Annual Salary = Hourly Rate × Hours per Week × Weeks per Year

If you regularly work overtime include your average weekly earnings in the calculation so the calculated salary will accurately reflect your total salaried earnings for the year.

Regular Pay = Hourly Rate × Hours per Week × Weeks per Year

Overtime Pay = Hourly Rate × Overtime Multiplier × Overtime Hours per Week × Weeks per Year

Double Time Pay = Hourly Rate × 2 × Double Time Hours per Week × Weeks per Year

Annual Salary = Regulay Pay + Overtime Pay + Double Time Pay

Calculate Salary from an Hourly Rate including Overtime

In this example say your pay rate is $30 per hour. You work 40 hours per week, 52 weeks per year. You average 10 overtime hours per week at an overtime rate of 1.5. You'd like to convert your hourly pay into an annual salary equivalent.

1. Calculate Annual Regular Pay

   Regular Pay = $30 per hour × 40 hours per week × 52 weeks per year = $62,400 per year

2. Calculate Annual Overtime Pay

   Overtime Pay = $30 per hour × 1.5 × 10 hours per week × 52 weeks per year = $23,400 per year

3. Calculate Annual Salary by adding Overtime Pay to Regular Pay

   Annual Salary = $62,400 per year + $23,400 per year = $85,800 per year

Totaling your annual hourly pay plus overtime pay your equivalent annual salary is $85,800.