The quick conversion most people use wrong
The common rule is "double the hourly rate and add three zeros" to get the annual salary. $30 per hour × 2,000 hours per year = $60,000. That assumes 40 hours a week for 50 weeks — two weeks of unpaid time off. It is a close approximation, but it breaks down fast for part-time schedules, freelancers, and anyone with unusual paid time off.
The calculator above lets you set both inputs — hours per week and paid weeks per year — so the conversion matches your actual schedule. A 30-hour-per-week role with 48 paid weeks is very different from a 40-hour role with 52 paid weeks, and the number on the offer letter should reflect that.
Hours per week: what counts?
For full-time salaried employees, 40 hours is the standard, but the reality varies. Some companies set 35 as a "full week" and call it a benefit. Others quietly expect 45–50 from salaried staff. If you are a salaried employee putting in 50 hours a week, your effective hourly rate is 20% below your stated rate — you are giving away a workday every week.
For hourly employees, overtime rules kick in above 40 hours in most US states (California has daily overtime rules too). Your real hourly average, after overtime, is often meaningfully higher than base rate. Include overtime if you want a true comparison to a salary.
Paid weeks per year — the number that matters most
There are 52 weeks in a year, but almost no one is paid for all of them. Subtract unpaid vacation, unpaid sick time, and unpaid holidays. Full-time employees with two weeks of paid vacation are effectively paid for 52 weeks even though they only work 50 — their hourly rate is calculated on 52 weeks and they still get paid during vacation. Contractors who take two weeks off unpaid are paid for 50 weeks.
Default to 50 weeks if you are an hourly worker or contractor who takes roughly two weeks off. Use 52 if you are salaried with paid vacation and want the apples-to-apples number for your rate.
Hourly to salary: worked examples
- $20/hour × 40 hrs × 50 weeks = $40,000/year
- $35/hour × 40 hrs × 50 weeks = $70,000/year
- $50/hour × 40 hrs × 50 weeks = $100,000/year
- $75/hour × 40 hrs × 50 weeks = $150,000/year
- $100/hour × 40 hrs × 50 weeks = $200,000/year
For part-time work, scale proportionally. $40/hour at 20 hours per week is $40,000 per year, not $80,000.
Salary to hourly: worked examples
- $50,000/year ÷ 2,000 hrs = $25/hour
- $80,000/year ÷ 2,000 hrs = $40/hour
- $120,000/year ÷ 2,000 hrs = $60/hour
- $200,000/year ÷ 2,000 hrs = $100/hour
If you are deciding whether to take a salaried offer or stay on contract, calculate the hourly equivalent and then add benefits, paid time off, and employer payroll taxes (roughly 10–12% on top). A $100,000 salary with benefits is worth roughly the same as $110,000–$120,000 in self-employed contract income, not $100,000.
Hiring: what hourly equivalent should you pay?
If you are a small business owner weighing an hourly vs salaried hire, use this calculator to convert both options to the same unit. A salaried role costs predictably but typically runs 10–20% higher than the equivalent hourly rate because of benefits, paid time off, and payroll taxes. Our employee cost calculator breaks this down end-to-end.
Freelancers and consultants: back into the hourly rate you need
Freelancers cannot just mirror a staff hourly rate — you must cover self-employment tax, health insurance, retirement savings, time spent on non-billable work, and buffer for gaps between contracts. A useful rule of thumb: a freelancer needs to charge roughly 2× the effective hourly rate of the equivalent staff role to net the same take-home income. See our freelance rate calculator for a detailed model.
Paycheck frequencies and what they mean
- Weekly: 52 paychecks per year. Common in trades and manual labor. Higher payroll overhead for employers.
- Bi-weekly: 26 paychecks per year. Most common in US private sector.
- Semi-monthly: 24 paychecks per year, paid on the 1st and 15th. Common in salaried/corporate roles.
- Monthly: 12 paychecks per year. Common in government and international roles.
The annual number is identical under any frequency — only the size of each check differs. The calculator above shows all four periods from your input.
Don't forget taxes
Hourly rate and annual salary are gross figures. Federal income tax, state tax, Social Security, and Medicare come off before it lands in your account. The effective "net" hourly rate is 25–35% lower than gross depending on your state and bracket. If you are self-employed, add another ~7.65% for the employer half of Social Security and Medicare. Run quarterly estimated tax to avoid an April surprise.