Maybe you’ve just come across a job listing or been offered a job that pays $28 an hour, and it’s time to crunch the numbers. 28 dollars an hour is how much a year? What about per month, week, and day? How much might you be left with after taxes? Is $28 an hour different if you’re a freelancer vs. a W-2 employee for a company? Let’s dive into these questions and more information about how well you might be doing with a $28/hr job.
Let’s assume you’re working full-time, meaning 8 hours a day, 5 days a week, 52 weeks a year (including paid vacation time). We can use some simple multiplication to calculate how $28/hr adds up over each time period:
- Daily: $28 x 8 hours = $ 224 a day
- Weekly: $224 a day x 5 days = $1120 a week
- Monthly: $1120 a week x 4.33 (the average number of weeks per month) = $4849 a month
- Yearly: $1120 a week x 52 weeks = $58240 a year
These are all the gross figures, meaning they’re what you earn before taxes are taken out. Your specific tax rates will vary depending on where you live, whether you’re filing jointly or singly, what deductions you qualify for, and so on. 25% is generally a good ballpark figure to estimate for federal and state taxes.
Using that 25% number, we can multiply our previous figures by the remaining 75% to figure out about how much take-home pay you can expect after taxes when you earn $28 an hour:
- Daily: $224 x 75% = $168 take home
- Weekly: $1120 x 75% = $840 take home
- Monthly: $4849 x 75% = $3637
- Yearly: $58240 x 75% = $43680
You can use a U.S. tax calculator to more specifically estimate how much to expect in taxes. Note that if you’re earning $28/hr as a freelancer, you’ll pay even more, since you’re responsible for all your FICA taxes instead of having those covered by an employer. Personally, I usually set aside more like 1/3 of my income because of this. (Learn more about self-employment taxes from the IRS here.)
In the 2020s, is $28 an hour a decent, livable wage? The answer here is both simple and complicated: it depends.
The biggest factor is simply where you live. If you’re a digital nomad living in Thailand and making $28 US, you can live in luxury in a penthouse apartment. If you live in the Midwest US, you can probably afford a mortgage on a decent house. But if you’re in a city like New York or San Francisco, $28 an hour will probably get you a closet with six roommates.
Let’s look at an example monthly budget for someone making $28 an hour. Since housing is one of the biggest expenses, we’ll start there, using the rule of thumb that you shouldn’t spend more than 30% of your gross monthly income on housing. We’ll also budget in 15% on savings—you can always save more than this if you’re able, but think of saving and investing as a priority, not just “whatever I have left after my spending.” That’s money you’re paying to your future self to make your life better!
Net Monthly Income: $3637
- Housing: $1454
- Savings: $545
- Car payment: $300 (or save up and buy a used car in cash)
- Utilities: $200
- Insurance: $200
- Food: $200 (try some of these $5 meal prep ideas)
- Phone: $20 (see our review of Tello Mobile’s budget plans)
- Discretionary: $340 (entertainment, new clothes, personal and household hygiene, extra savings, etc.)
Depending on where you live, this kind of budget might seem extremely doable, or it might feel like there’s not much wiggle room. Affording everything and managing to save will be a lot easier if you have a dual-income household. Two people who each work full-time and earn $28 dollars an hour have a net take-home of $7274, which is a pretty solid amount for living well in most places!
Looking to stretch that $28 an hour wage as far as you can so you can live well and bump up your savings rate? It’s totally possible if you’re determined enough! Check out these 72 tips to save money.
If you can only strip your budget down so far and you can’t find a job paying more than $28 an hour, consider supplementing your work with side gigs on nights or weekends. This can be as simple as doing surveys on Swagbucks while you watch TV, or walking dogs through Rover on Saturday mornings, or even starting your own business. Check out 114 side hustle ideas here!
TL;DR: If you just came for the short answer to 28 dollars an hour is how much a year? Answer: $58240 before taxes.