How This Calculator Works

Your hourly wage is what your employer quotes. Your real hourly take-home is what you actually earn after taxes. The difference can be brutal. This calculator shows you both.

Here’s the breakdown:

First, we calculate your weekly gross pay. That’s your hourly rate times hours worked, plus overtime at time-and-a-half if applicable. Then we subtract federal income tax (using 2025 brackets), Social Security (6.2%), Medicare (1.45%), and any pre-tax deductions you entered. What’s left is your weekly net pay. Divide that by your total hours, and you get your real hourly take-home.

This number matters more than your quoted wage. A $20/hour job that gives you 40 hours a week is very different from a $20/hour job that only schedules you 25 hours. And after taxes, that $20 might only be $15 in your pocket. Knowing your real hourly value helps you compare jobs, understand offers, and budget accurately.

Hourly Work Reality

Gross Hourly vs. Net Hourly

Gross hourly is the advertised rate. It’s what the job posting says, what your manager quotes, and what sounds good when you tell people. Net hourly is what you actually take home after everything gets pulled out. For most hourly workers, net is 70% to 80% of gross. Sometimes less if you’re in a high-tax state or have expensive benefits.

This gap surprises people. Someone making $18/hour thinks they’re earning $720 for a 40-hour week. But after federal tax, FICA, and state tax, they might only see $550. That’s $170 gone. Over a year, that’s nearly $9,000 in taxes. Understanding this gap is critical for realistic budgeting.

Fixed Hours vs. Variable Hours

Fixed hours mean you know your schedule in advance and it doesn’t change much. You can predict your paycheck, plan your budget, and commit to regular expenses. Variable hours mean your schedule changes weekly. Some weeks you get 35 hours, some weeks you get 20. Your income swings constantly, which makes everything harder.

If your hours are variable, never budget based on your best week or even your average week. Budget based on your worst realistic week. Otherwise you’ll constantly be short when hours get cut.

Overtime Impact

Overtime pays time-and-a-half (1.5x your regular rate) for hours over 40 per week. That sounds great, and it is, but don’t assume every overtime dollar is take-home. You still lose the same percentage to taxes and FICA. So if you’re making $20/hour and work 10 hours of overtime, that’s $300 gross. But you’ll only see about $220 to $240 after taxes.

Also, overtime isn’t guaranteed. If your budget depends on overtime and overtime stops, your income drops immediately. Build your baseline budget on 40 hours (or whatever your guaranteed minimum is), then treat overtime as extra for savings or debt payoff.

The Part-Time Trap

Part-time hourly work often pays the same rate as full-time, but you get fewer hours. Fewer hours means less weekly income, but it also means less access to benefits. No health insurance, no PTO, no retirement match. You’re earning the same per hour but getting way less total compensation. Always factor in benefits (or the lack of them) when comparing part-time offers.

Multiple Jobs Reality

Working two or three part-time jobs to make ends meet is exhausting, but it’s also common. The problem? Each employer withholds taxes separately based on what they’re paying you, not your total income. You might be under-withheld and owe money at tax time. Or you might be over-withheld and giving the government an interest-free loan all year.

If you’re working multiple jobs, consider adjusting your W-4 or setting aside extra money for taxes. Don’t assume your withholding is correct just because money is being taken out.

Common Mistakes Hourly Workers Make

Budgeting based on gross hourly instead of net. You think you’re making $16/hour, so you budget like you’re bringing home $640/week for 40 hours. But you’re really only seeing $500 to $520 after taxes. The math doesn’t work.

Assuming all hours are equal. Regular hours and overtime hours pay differently, but they’re also taxed the same percentage. Don’t treat overtime as pure bonus money. It’s good money, but it’s not all yours.

Ignoring schedule volatility. If you’re scheduled 38 hours one week and 28 the next, your paycheck swings by hundreds of dollars. Budget for the low weeks, save during the high weeks.

Not tracking actual hours worked. Your employer might schedule you for 40 hours, but if you’re clocking in late or leaving early, you’re not getting paid for 40 hours. Track your real hours, not your scheduled hours.

Comparing jobs by hourly rate alone. Job A pays $19/hour but only gives you 25 hours/week. Job B pays $17/hour but guarantees 40 hours/week. Job B is the better financial choice. Always multiply rate by hours to get real weekly income.

What If My Hours Get Cut?

It happens. Business slows down, new employees get hired, schedules change. If you’re scheduled for fewer hours, your income drops proportionally. Going from 40 hours to 30 hours is a 25% pay cut. That’s massive. Keep savings to cover these gaps, and start looking for additional work or a more stable job immediately if cuts become regular.

What If I Get a Raise?

A raise increases your gross hourly, which increases your weekly and annual income. But you’ll also pay more in taxes because your total income is higher. A $2/hour raise sounds like $80 more per week, but you’ll only see about $60 to $65 after taxes. Still good, just not as much as you might expect.

What If Overtime Disappears?

If you’ve been counting on overtime and it stops, your income can drop 20% to 30% overnight. This is why you should never build your baseline budget around overtime. Budget for 40 hours (or your guaranteed minimum), and use overtime for savings, extra debt payments, or discretionary spending.

What If I Switch to Salary?

Switching from hourly to salary feels like a promotion, but do the math. If you’re making $22/hour at 40 hours/week, that’s $45,760 annually. If a salaried offer is $48,000, that’s only a $2,240 raise. But salaried workers often work more than 40 hours without extra pay. If you’re working 50 hours/week on salary, your real hourly rate drops below what you were making as an hourly worker.

What If I Work Seasonal Hours?

Seasonal work (retail during holidays, landscaping in summer, tax prep in spring) means high hours during busy times and low or zero hours during slow times. Save aggressively during high-hour months. You need those savings to survive the low-hour months. Budget on your worst month, not your best.

What If Benefits Are Offered?

Health insurance, PTO, retirement match, these all have value, but they’re not cash. A job paying $17/hour with benefits might be better than a job paying $20/hour without, but only if you actually need and use those benefits. Don’t let benefits justify a wage that’s too low to cover your bills.

Real Hourly Pay Examples

Hourly Rate	Hours/Week	Filing Status	Weekly Gross	Est. Weekly Net
$15/hr	40	Single	$600	~$485
$18/hr	35	Single	$630	~$505
$22/hr	40	Married	$880	~$725
$25/hr	45 (5 OT)	Single	$1,188	~$945
$12/hr	25	Single	$300	~$250

Estimates based on 2025 federal tax only. State tax, local tax, and other deductions will reduce take-home further.

Budget Safety for Hourly Workers

Hourly income is less stable than salary. Your budget needs to reflect that. Keep three to six months of expenses saved. Budget based on your minimum guaranteed hours, not your average or hoped-for hours. If you get more hours, great. Save that extra money. Don’t spend it assuming it’ll keep coming.

Income Stability Check

Stable: Guaranteed hours, consistent schedule, overtime available but not required. You can plan mid-term.

Moderate: Mostly consistent hours with occasional fluctuations. Plan month-to-month, keep extra savings.

Volatile: Hours change weekly, no guarantees, seasonal work. Budget on worst-case weeks, keep large emergency fund.

Emergency Fund Requirements

If your hours are guaranteed and your job is stable, three months of expenses is okay. If your hours fluctuate or your job is unstable, aim for six months. If you’re seasonal or gig-based, push for twelve months. This isn’t optional. When hours drop or jobs end, savings are what keep you housed and fed.

Frequently Asked Questions

Why is my net hourly so much lower than my wage?

Taxes. Federal income tax, Social Security, Medicare, and potentially state and local taxes all come out before you see the money. For most hourly workers, you lose 20% to 30% of your gross pay to these deductions. So a $20/hour job nets you about $15 to $16/hour after federal taxes.

Is this accurate?

It’s accurate for federal taxes using 2025 tax brackets. It does not include state tax, local tax, or deductions like health insurance beyond what you manually entered. Your real take-home will be lower. Use this as a baseline, not a final number.

Should I take a higher hourly rate with fewer hours or lower rate with more hours?

Multiply rate by hours to get weekly income. A $20/hour job at 25 hours is $500/week gross. A $17/hour job at 40 hours is $680/week gross. The lower rate wins if it gives you more total income. Also factor in benefits and schedule consistency.

How much overtime should I work?

Financially, as much as you can handle without burning out. Overtime is good money. But if working 60-hour weeks is wrecking your health or relationships, the extra money isn’t worth it. Find a sustainable balance, and don’t budget around overtime income since it can disappear.

What if my employer doesn’t pay overtime?

If you’re a non-exempt hourly worker in the US and you work over 40 hours in a week, your employer is legally required to pay you time-and-a-half for those hours. If they’re not, that’s wage theft. Document everything and contact your state labor board or the Department of Labor.

Can I live on minimum wage?

Depends on where you live and your expenses. Federal minimum wage is $7.25/hour, which is about $290/week gross for 40 hours, or roughly $235/week net. That’s about $1,000/month take-home. In most cities, that’s not enough to cover rent, food, and basics. You’d need roommates, assistance, or additional income.

Should I ask for more hours or a higher rate?

More hours is usually easier to get than a raise. If you can handle more hours and they’re available, that’s often the faster path to more income. But there’s a limit. Working 60 hours/week at $15/hour is $1,125/week gross. Working 40 hours at $18/hour is $720/week gross, with 20 more hours of free time. Sometimes the raise is worth more than the hours.

What’s the biggest mistake hourly workers make?

Not saving when hours are good. Hourly work is volatile. When you’re getting 45 to 50 hours, save that extra money. Don’t lifestyle creep. When hours drop to 30, you’ll need those savings to cover the gap. Treat high-hour weeks as windfalls, not the new normal.