TL;DR: For those who just got here for a brief answer $18 an hour is how much per 12 months? Answer: $37,440 before taxes.
Whether you may live comfortably on $18 an hour depends largely on various aspects reminiscent of location, lifestyle, financial obligations and family size.
So let’s crunch the numbers. $18 an hour is how much per 12 months? What in regards to the month, week and day? How much can you have got left after taxes?
Is $18 an hour different for a freelancer than a W-2 worker at an organization? Let’s dig deeper into these questions and learn more about how well you may do working for $18 an hour.
How much is $18 per hour per 12 months, month, week or day?
Let’s assume you’re employed full time, i.e. 8 hours a day, 5 days per week, 52 weeks a 12 months (including paid day off).
We are able to use easy multiplication to calculate how $18/hour adds up. in each period:
- Daily: $18 x 8 hours = $144 per day
- Every week: $144 per day x 5 days = $720 per week
- Monthly: $720 per week x 4.33 (average variety of weeks per 30 days) = $3,117.60 per 30 days
- Annually: $720 per week x 52 weeks = $37,440 per 12 months
These are all gross amounts, meaning you earn before taxes are withheld.
Your specific tax rates will vary depending on where you reside, whether you file jointly or individually, what deductions you qualify for, and so forth. 25% is mostly a great figure to estimate for federal and state taxes.
Using this 25% number, we will multiply our previous numbers by the remaining 75% to learn how much take-home pay you may expect to earn after taxes if you happen to earn $18 per hour:
- Daily: $128 x 75% = $108 to take home
- Every week: $720 x 75% = $540 take home
- Monthly: $3,117.6 x 75% = $2,338 take home
- Annually: $37,440 x 75% = $28,080 take home
You need to use a US tax calculator to get a more accurate estimate of how much you may expect to pay in taxes.
Do not forget that if you happen to earn $18/hour as a freelancer, you may pay much more since you’re chargeable for all FICA taxes, not your employer.
Personally, I normally save about 1/3 of my income for that reason.
Is $18 an hour a great wage?
The reply here is straightforward and sophisticated: it depends.
In 2023, the federal poverty level for a single person is about at $14,580, an amount significantly lower than the $37,440 annual income that might be earned at $18 an hour.
But how far does this money go?
An important factor is solely where you reside. For those who are a digital nomad living in Cambodia and earning $18, you may live in luxury in a penthouse apartment.
For those who live somewhere low cost in Mississippi, you may probably afford a mortgage on an honest house. But if you happen to’re in a city like Recent York or San Francisco, for $18 an hour you’ll likely get a closet with six roommates.
Budgeting while making $29 an hour
Let us take a look at an example monthly budget for somebody earning $18 per hour.
Since housing is certainly one of your biggest expenses, we’ll start there with the rule of thumb that you mustn’t spend greater than 30% of your gross monthly income on housing.
We’ll also budget 15% for savings – you may at all times save more if you happen to can, but consider saving and investing as a priority, not only “what’s left after spending.”
That is money you pay your future self to make your life higher!
Monthly net income: $2,338
Depending on where you reside, this sort of budget could appear extremely doable, or it could look like there is not much room to alter. Providing for all the pieces and managing your savings might be much easier if you have got a two-income household.
Two individuals who each work full-time and earn $18 an hour have a net income of $4,676.4, which in most places is a reasonably solid amount for the great life!
Wish to stretch your $18-an-hour wage as much as possible so you may live well and increase your savings rate? It’s quite possible if you happen to’re determined enough! Check these out ways to lower your expenses.
For those who’re on a good budget up to now and might’t discover a job that pays greater than $18 an hour, consider supplementing your work with side gigs within the evenings or weekends.
It may possibly be so simple as conducting surveys on the subject Swagbucks while watching TV or walking the dogs around Rover on Saturday mornings, and even while starting your individual business. Take a look at small business ideas you may start cheaply here!