How to convert hourly pay to an annual salary
Short answer
Multiply your hourly rate by the hours you work each week, then by the weeks you work per year. At 22 dollars an hour, 40 hours a week, 52 weeks: 22 x 40 x 52 = 45,760 dollars gross per year. That is before taxes and deductions, so your take-home pay will be lower.
Hourly to annual salary
Annual salary (gross) = hourly rate x hours per week x weeks worked per year
- •hourly rate: what you earn per hour before deductions
- •hours per week: the hours you typically work in a week
- •weeks worked per year: 52 if all time off is paid, or fewer if some time off is unpaid
- •gross: the total before taxes and deductions, so take-home pay is lower
The formula
Annual salary (gross) = hourly rate x hours per week x weeks worked per year.
Use 52 weeks if all of your time off is paid, or fewer weeks if some of your time off is unpaid. The weeks number is where most people trip up, so it is worth thinking about rather than defaulting to 52 out of habit.
The result is a gross figure: the amount before income tax, payroll taxes, retirement contributions, health insurance, and anything else that comes out of your paycheck.
A full-time example
Say you earn 22 dollars per hour and work a standard 40-hour week, paid for all 52 weeks including vacation and holidays:
22 x 40 x 52 = 45,760 dollars per year gross.
That 45,760 dollars is the annual salary equivalent of your hourly rate. It is the number to use when you are weighing a job that quotes an hourly rate against one that quotes a yearly salary, as long as you remember both figures are gross unless someone says otherwise.
A part-time example
The same formula covers part-time schedules. Suppose you earn 18 dollars per hour and work 25 hours per week across 52 weeks:
18 x 25 x 52 = 23,400 dollars per year gross.
Cutting the weekly hours pulls the annual number down fast, which is why two people with nearly the same hourly rate can land at very different yearly totals. If your part-time hours swing week to week, base the calculation on a typical week rather than your busiest one, or you will overestimate.
Gross salary versus take-home pay
Gross salary is the headline number the formula gives you. Take-home pay, also called net pay, is what actually lands in your bank account after everything is withheld.
The gap depends on where you live, how much you earn, your filing status, and what you choose to have deducted. Federal income tax, Social Security and Medicare, any state or local income tax, health insurance premiums, and retirement contributions all reduce what you keep.
So in the full-time example, 45,760 dollars is the gross salary, but your yearly take-home will be meaningfully lower. No single percentage applies to everyone, so any gross-to-net figure here is an estimate only, not financial or tax advice. Your real paycheck is the reliable source.
Why unpaid time off changes the total
The 52-week assumption only holds if you are paid for every week of the year, and many hourly workers are not. Take two weeks off without pay and you are earning for 50 weeks, not 52.
Rework the full-time example with 50 paid weeks:
22 x 40 x 50 = 44,000 dollars per year gross.
That is 1,760 dollars less than the 52-week figure, from the same hourly rate and the same weekly hours. Unpaid holidays, seasonal gaps, sick days without pay, and stretches between contracts all bite the same way. If your income is uneven, budgeting from the lower, more realistic weeks count keeps you from planning around money you will not receive.
Common mistakes
A handful of errors show up over and over when people convert hourly to annual:
- Assuming 52 paid weeks. If any of your time off is unpaid, use the weeks you are actually paid for, such as 50, or your total will run high.
- Ignoring overtime. Extra hours are often paid at a higher rate, so multiplying every hour by your base rate undercounts a job with regular overtime. Figure those hours and their rate separately.
- Confusing gross with net. The formula gives gross pay. Comparing your gross annual number against someone else's take-home, or against your monthly bank deposits, compares two different things.
- Using your best week instead of a typical one. For variable hours, average a normal week rather than picking your busiest.
- Forgetting that hours can change. A number built on 40 hours a week falls apart if you are cut to 32. Re-run the math when your schedule shifts.
Working backward and other conversions
Run the formula in reverse to check whether a salaried offer matches your hourly expectations: divide the annual salary by your weeks worked, then by your weekly hours, for an approximate hourly rate. A standard 40-hour week across 52 weeks is 2,080 hours, so dividing a salary by 2,080 gives that rate directly. This helps when a posting lists only a yearly figure.
To find the rate itself, the Hourly Rate Calculator handles it, and the Budget Calculator can help you plan once you have a realistic take-home number in mind. Everything runs in your browser; the numbers you type are not sent anywhere or stored.
Frequently Asked Questions
Should I use 52 weeks or 50?+
Use 52 only if you are paid for every week of the year, including vacation and holidays. If you take unpaid time off, use the weeks you are actually paid for. Two unpaid weeks means 50, which at 22 dollars an hour and 40 hours a week drops the gross total from 45,760 to 44,000 dollars.
Does this formula include overtime?+
No. It multiplies every hour by a single rate, so it assumes no overtime premium. If you regularly work beyond your standard hours at a higher rate, calculate those overtime hours separately at their own rate and add the result to your base total.
Why is my paycheck smaller than the salary this gives me?+
The formula produces gross pay, the amount before anything is withheld. Federal and any state income tax, Social Security and Medicare, health insurance, and retirement contributions all come out before you are paid, so take-home pay is always lower than the gross annual figure.
How do I convert a part-time hourly rate to a yearly number?+
Use the same formula with your real weekly hours. At 18 dollars per hour for 25 hours a week over 52 weeks, that is 18 x 25 x 52 = 23,400 dollars gross per year. If your part-time hours vary, base it on a typical average week rather than your busiest one.
Can I turn a yearly salary back into an hourly rate?+
Yes. Divide the annual salary by the weeks you work, then by your weekly hours. A standard 40-hour week across 52 weeks is 2,080 hours, so dividing a salary by 2,080 gives an approximate hourly rate, which is useful for comparing a salaried offer against an hourly one.
Skip the math
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