How to Convert Hourly Pay to Annual Salary
Converting an hourly wage to an annual salary equivalent is one of the most common pay comparison calculations. When evaluating job offers, negotiating raises, or budgeting, you need to know what your hourly rate means in total annual income. The standard formula is: Hourly Rate × Hours Per Week × Weeks Per Year.
The Standard 40×52 Calculation
The most common assumption is 40 hours per week and 52 weeks per year, giving 2,080 total annual hours. At this assumption: $15/hour = $31,200/year, $20/hour = $41,600/year, $25/hour = $52,000/year, $30/hour = $62,400/year, $50/hour = $104,000/year. These are gross figures before any tax deductions.
Accounting for Vacation and Holidays
If you want a more conservative estimate reflecting actual working time, use 50 weeks (accounting for 2 weeks of vacation/holidays) or even 48–49 weeks for those with more generous PTO. Unpaid time off reduces your effective annual earnings even if your hourly rate stays the same.
Overtime Pay
For non-exempt hourly workers, the FLSA requires overtime pay of at least 1.5× the regular rate for hours over 40 per week. If you regularly work overtime, your actual annual income can be significantly higher than the base calculation suggests. This calculator includes overtime earnings in the total annual figure.
Comparing Hourly to Salary Offers
When comparing an hourly offer to a salary offer, don't just look at the base numbers — consider benefits. Hourly positions may not include health insurance, retirement matching, or paid time off. A $25/hour position without benefits may actually pay less than a $50,000 salaried position that includes $10,000+ in employer-paid benefits.