Hourly Paycheck Definition
How much money would you like to make a year? Your tax returns will tell you how much you’re currently making, but it won’t tell you how much your time is actually worth. For that, you need an hourly paycheck calculator.
This useful calculator (located just on the sidebar) allows you to put in your current (or desired) salary and the time you spend (or would like to spend) working to discover just how much money you make (or would have to make) working (or not working). You’ll discover valuable insight into the value of your work. When you’re done, you may find it necessary to either a) as an employee, move on to greener pastures where you earn more money for the work that you do or b) as an independent business owner, assess what you need to do to increase your ROI (return on investment).
1. Enter Your Annual Salary Information
To begin, gather your pay stubs or last year’s tax return. Enter your annual income into the box provided in “What is DESIRED annual income?” When entering the information, enter the dollar amount before taxes.
Before tax wages is a great tool to use when comparing one (or more) job against another. The hourly wage comparisons can show you what the real wage of a salary job is compared to an hourly one. For example, consider a job that earns you $30,000 a year. Should you take that over a job that pays $10 per hour? Using the hourly wage calculator will help you make comparative decisions and choose the job that earns you the highest salary for your time.
2. Enter Your Average Hours Worked Per Week
Most people just assume they work eight hours a day. You clock in at 9am and clock out at 5:30pm after a half hour lunch. But we all know that a work schedule is rarely that cut and dry. Here are several factors that can affect the amount of hours that you work per week.
- The Working Lunch: Officially, you take an hour or a half-hour for lunch. Unofficially, many salary workers spend their lunch hours working and eating at their desk. And when you’re calculating your real wage, those hours count.
- Commute Time: When you’re traveling to work, you’re not necessarily working. But you are giving time to your job. A two-hour total commute both ways is two extra hours that you’re taking away from your family and personal time. When you’re comparing jobs or considering whether to make a career move, incorporating commute time can provide a clearer perspective.
- Overtime: For salaried workers, calculating overtime is crucial to discovering their real wage. If you’re really working 11 hours per day on average, you earn a different hourly wage than someone with the same salary who only works 8 hours per day. It’s possible you may be making less than non-salaried positions that require less responsibility, training, and skill.
Once you’ve entered your before tax salary and your real weekly hours into the calculator, you will now know what your time is really worth, as well as your tax rate (adjusting for 30%). When you take an extra-long lunch break or take on more projects, you can make real-time calculations. With this up-to-the-minute information, you can take control over your finances and steer your career in the right direction.
Information is power and power is what you do with that information. Now GO GET’EM!