If you’re currently earning $20 an hour or have just received a job offer that pays $20 an hour, chances are you’re wondering the question “$20 an hour is how much a year?”
This post will run through some quick math regarding how to arrive at the right salary number, let you know how much $20 an hour is in different time increments, and also discuss whether or not $20 an hour is enough to live off of.
$20 an Hour is How Much a Year?
To determine how much $20 an hour is on a yearly basis, you can go online and use a salary calculator. Alternatively, you can do some basic math and arrive at the answer.
A quick caveat is that depending on how often you work, the answer to this question is going to differ. If you work part-time 20 hours a week, the yearly amount you will receive is going to be significantly less than if you work 40 hours a week.
Assuming you’re working 40 hours a week, 52 weeks a year, that means that you’ll have a total of 2,080 working hours in which you’ll be getting paid. 40 hours/week times 52 weeks/year equals 2,080 hours in a year.
Taking 2080 hours in a year and multiplying it by $20 an hour gets you $41,600 a year. That means that if you’re working full-time, $20 an hour works out to be a total annual salary of around $40,000 a year.
However, if you are making $20 an hour but only working part-time 20 hours a week, you will only be making $20,800 a year. Alternatively, if you are really putting in the effort and working 50 hours a week, you will be making $52,000 a year.
$50 an Hour is How Much a Year?
Using the above logic, we can easily apply it to any wage and determine from an average hourly pay how much you will be making annually.
Using $50 an hour as an example, you can multiply this number by 2080 to get $104,000 which is how much money you would be paid in a year assuming you work full 40-hour weeks and work all 52 weeks in a year.
Quick Tip For Calculating Salary Sizes
It’s good to know how much $20 an hour is in a yearly salary, but chances are you’re not going to be getting paid $20 an hour your whole life. After all, wages change with time due to various reasons. Inflation has an effect on pushing wages up, and also, with more experience, you’ll tend to make more money.
If you don’t want to go through and do the calculation of multiplying the number of working hours in a week by the number of weeks in a year, you can use a simple tip for converting your hourly wage into a salary number. Just take the hourly wage you’ll be making, and multiply it by two. The remaining number is about how many thousand dollars you will be making in a year.
For example, if you are making $20 an hour:
- $20 x 2 = $40
- Therefore, you will be making around $40 thousand a year.
Using this tip won’t get you the exact dollar amount of money you will make in a year, but it will get you pretty darn close. Of course, this is assuming you work 40-hour weeks and don’t have random situations where you decide to work a 45 hour week or take a long leave from work to travel.
How Much is 20 an Hour Per Month?
Earning $20 an hour will get you around $40,000 a year, but oftentimes bills need to be paid on a monthly basis. For this reason, it’s important to know how much $20 an hour is per month.
Taking the full number of $41,600 a year and dividing it by 12 months in a year gets you to $3466.67 per month. This is roughly how much money you’ll be making every month if you work 40 hours, 52 weeks in a year. However, if you get paid every four weeks, you will be making $3200 instead.
How Much is 20 an Hour Per Week?
On a weekly basis, $20 an hour works out to be around $800 per week. If you get paid every two weeks, this means you’ll be receiving a check for around $1600 every payday.
If you work part-time, you can just take the total number of hours you work in a week and multiply it by your wage ($20) to get to the amount of money you’ll be paid every week. If you work 25 hours a week, you would make $500 every week.
20 an Hour is How Much a Year After Tax?
For most salaried employees, taxes play a large role in how much the real take-home pay will be. Earning 20 dollars per hour might sound nice, but when you factor in taxes the actual amount of money you’ll be taking home will be much less.
Of course, how much tax you pay will depend on a variety of factors including taxable income adjustments, tax credits, tax deductions, exceptions, and filing status.
Assuming you’re a single individual who makes $20 an hour and has no dependents or other monthly deductions, you’ll likely be subjected to around $3,300 of federal income tax and $1500 of social security contributions. This means your actual take-home pay after tax will be around $36,800. If you take this number and back into an hourly wage with it, this works out to be around $17 – $18 an hour.
Of course, this is a very generic assessment and your actual after-tax income will depend entirely on your personal situation. If you buy a home, get married, retire, have a kid, plan to retire, or change your resident state, the amount of tax you are obligated to pay will vary and change.
Can You Live Off $20 an Hour?
Whether or not you can live off of $20 an hour will depend on a variety of factors. Here are some things to consider when determining whether a $20 hourly wage is enough for you to live off of:
- Location – One of the biggest factors that will indicate your cost of living is location. $20 an hour may be enough to live in certain Midwestern states, but in places like New York City and San Francisco, you’ll find it really tough to get by with just $20 an hour.
- Marital status – If you are married to someone who has a decent salary and the two of you are living together, you can save on some costs and $20 an hour may be enough to live on. Conversely, if you are married to someone who doesn’t work at all, you’ll need to work extra hard to support another person and $20 an hour won’t go as far.
- Kids – If you are single and have no kids, you will find it much easier to live on $20 an hour than if you are married with multiple kids. Kids require a lot of money and $20 an hour might not be enough.
Is $20 an Hour Good Pay?
If you make $20 an hour, you earn more than most people in the United States, but you also earn less than the national average. In reference to the section above, whether $20 an hour is good pay and whether you can live off it depends largely on your own circumstance.
How to Live on $20 an Hour
Here are some tips to help you live on $20 an hour and make do with what you have:
- Pay Off Your Debt – Debt can accumulate and really eat into your earnings via interest if you don’t deal with it swiftly. Prioritize paying off any outstanding debt you have if you find that a large chunk of your paycheck is going towards interest payments.
- Create a Budget – A budget can often help you make a financial plan for each month. Clearly listing out your income and each expense can give you a better idea of what you need to cut back on and which items are truly necessary versus wants.
- Lower Your Taxes – Taxes cut into your overall take-home pay significantly. If you can find ways to cut down on your taxes, you can boost how impactful your $20 an hour wage is. Some states in which you don’t need to pay state income taxes on wages are Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
- Live Below Your Means – One thing that society has taught most of us is that more is always better. We are often striving for that shiny new car, the cool new gadget your neighbor has, or some other material possession. Realizing the value of simplicity can help you become more satisfied with what you already have and make your $20 an hour more meaningful.
- Generate Passive Income – Figuring out ways to make passive income and implement passive income ideas can provide you with a separate cashflow stream and make it easier to live off $20 an hour.
- Make Saving Money Fun – Whether you have been saving money for a long time and need an extra boost of motivation or need to just start saving money, making saving money fun can help you save more and increasingly live on just your basic living expenses.
- Learn about Investing: Invest whatever you can save so that your money is growing and not being reduced through inflation. Read as many books on investing as you can to increase your knowledge.
Jobs That Pay $20 an Hour
If you’re looking for ways to make $20 an hour, here are some jobs that typically pay around a $20 wage:
- Bank tellers
- Uber / Lyft Drivers
- Truck Drivers
- Security Guards
- Virtual Assistants
- Customer Service Representatives
- Warehouse Workers
- Interior Designers
Recap: $20 an Hour is How Much a Year?
Making 20 dollars an hour is pretty decent in today’s day and age. $20 an hour works out to be around $40,000 a year before tax if you’re working fulltime 40 hours a week, and about $36,000 a year after tax, depending on where you live. Considering the median household income in the United States is around $67,000, making $40,000 a year isn’t bad at all.
Depending on your personal circumstances, if you budget well, $20 an hour can be enough to help you make ends meet and may even allow you to save some extra money.