When it comes to income goals, not many have the end goal at $50k annually. Although, the best place to begin your financial journey is a starter goal. $50,000 may not seem like much for the tail end of a career, but it is a great place to set your sights if you are just starting out. The issue is, if you’re just starting out, your wage is probably shown by the hour. So, if you are an hourly or freelance worker, it is important to ask: $50,000 is how much an hour?
Pre-Tax Breakdown
Here is a formula that will serve you well in these situations:
[(annual wage)/52] / (hours worked per week)
This is how you will determine the hourly wage required to land your annual goal. The formula will work part-time or full-time, as the hours worked is something you substitute in yourself. The reasoning is simple: There are 52 weeks in a year, and most people know their weekly hours.
Just knowing those two things, along with your income goal, you can fill it in pretty easily. So, if you work a full-time job and want $50k annually, the equation will look like this:
(50000/52) / 40
Once you punch those into a calculator, you will end up with around $24-per-hour to get right about $50,000 on-the-year. Say you work 20 hours each week as a part-timer or freelancer; just substitute the 40 for a 20, and you’ll need a little over $48-per-hour to meet your goal.
Post-Tax Goal
Post-tax gets trickier, as different states have different withholdings. Not only that, but different types of income are taxed at varied rates. So, this is something you’ll want to get in touch with a financial professional about. If you just need a rough ballpark, assuming traditional 1044 employee status, consider using an online paycheck calculator. This will help get an idea of what you will actually need to make in order to take home $50,000 each year. Once you get that yearly estimate, plug it in and see what you find for your hourly.
Read More:
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- 7 Hidden Costs of Home Ownership
- Should You Quit Your Job and Start a Business?
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