How the conversion works
Everything comes down to how many hours you're paid for in a year: hours per week × paid weeks per year. A full-time schedule of 40 hours for 52 weeks is 2,080 hours.
- Salary → hourly:
annual salary ÷ yearly hours - Hourly → salary:
hourly wage × hours per week × weeks per year, plus overtime at 1.5×
The other amounts follow from the yearly total: weekly pay is the annual figure ÷ weeks worked, biweekly is annual ÷ 26, semimonthly is annual ÷ 24 and monthly is annual ÷ 12. Daily pay assumes a five-day week.
Worked examples
A $65,000 salary
At 40 hours a week for 52 weeks, $65,000 ÷ 2,080 = $31.25 an hour. That's $1,250.00 a week, $2,500.00 every two weeks and $5,416.67 a month before taxes.
Now say the job really takes 45 hours a week with no overtime pay, which is common for salaried, exempt roles. The same $65,000 ÷ (45 × 52 = 2,340 hours) works out to just $27.78 an hour — about $3.47 less for every hour you actually work.
$25 an hour with overtime
At $25 an hour for 40 hours, plus 5 overtime hours a week at 1.5× ($37.50), weekly pay is $1,000 + $187.50 = $1,187.50. Over 52 weeks that's $61,750.00 a year. Without the overtime, but taking two unpaid weeks off (50 paid weeks), the same $25 rate gives $50,000.00.
Quick reference (40 hours a week, 52 weeks)
- $7.25/hour (federal minimum) ≈ $15,080 a year
- $15/hour ≈ $31,200 a year
- $20/hour ≈ $41,600 a year
- $25/hour ≈ $52,000 a year
- $30/hour ≈ $62,400 a year
- $50,000 a year ≈ $24.04/hour
- $75,000 a year ≈ $36.06/hour
- $100,000 a year ≈ $48.08/hour
Comparing a salaried job with an hourly one
A salary and an hourly wage can look equal on paper but differ in practice. Salaried roles often include paid time off and benefits but rarely pay overtime; hourly roles pay for every hour (and overtime) but may not pay for holidays. When you compare offers, adjust the weeks and hours to match what you'd really work, and remember these are pre-tax numbers.
Benefits matter too. Employer health insurance, a 401(k) match or paid leave can be worth thousands of dollars a year, so a slightly lower hourly figure on a job with strong benefits can still be the better deal.
Practical tips
- Track a normal month first. Log the hours you actually work for four weeks, including email after hours and unpaid breaks you work through, then enter that average.
- Part-time work: enter your real weekly hours. At 25 hours a week, a $20 wage is $20 × 25 × 52 = $26,000 a year, not the $41,600 a full-time schedule would give.
- Budget from the smallest paycheck. If you're paid biweekly, build your monthly budget on two checks; the two extra paychecks each year then become savings or a buffer.
- Negotiating a raise? Convert both the current and the proposed pay to the same unit before comparing, so a salary offer and an hourly offer are measured on equal terms.
Common mistakes
- Using 40 hours when you work 50. Your true hourly rate is based on the hours you actually put in.
- Counting unpaid weeks. Contractors and many hourly workers aren't paid for holidays or vacation — lower the weeks per year to match.
- Dividing by 4 for monthly pay. A month averages about 4.33 weeks. Divide the annual figure by 12 instead.
- Treating gross as take-home. Federal and state income tax, Social Security and Medicare come out first.
When this doesn't apply
The conversion assumes steady hours and pay. It won't fit well for commission or tip-heavy jobs, gig work with unpredictable hours, or self-employment, where you also pay both halves of Social Security and Medicare tax. Federal employees are a special case too: the government divides annual pay by 2,087 hours (the average number of paid hours in a year, accounting for leap years) rather than 2,080, so their official hourly rate is slightly lower.
Related calculators
To see what lands in your bank account, run your salary through the paycheck calculator, which estimates federal and state taxes. Comparing a raise? The percentage calculator shows the percent increase between two pay rates. And if you plan to invest part of each check, the compound interest calculator projects how it could grow.