How to calculate monthly income based on annual salary?

Question

Let's use this example - 30k annual salary

Would you do:

1) 30,000 / 2080 = 14.22

14.22 x 160 (for four 40hr work weeks per month) = $2307.69 per month gross income

OR

2) 30,000 / 12 = $2500 per month gross income

The reason I asked is because in my current job, the math works out like in option #1. I get paid bi-weekly and calculated using the gross income value.

But in my new job, the offer letter states my annual and monthly income in which the monthly income math works out like option #2.

What's the reason for doing it one way or another? Which method is correct?

Answer 1

The difference comes from how often you are paid. If you are paid every two weeks, you actually receive 26 paychecks a year. Occassionally there will be months where you receive three paychecks, because each month (other than Feb) is actually slightly longer than four weeks.

If you are paid twice a month like on the 1st and 15th then you would only be getting 24 paychecks, and each one would be slightly higher. In this case the math is: 30,000 / 24 = 1,250 per paycheck. 2 paychecks per month = $2500 per month.

If you are paid every other week, then the math is 30,000/26 = 1153.85 per paycheck, but you can't really do a monthly number. For example, March has 31 days, which is 4.43 weeks, which gives you a monthly pay of 2,555. But in months with 30 days it will only be $2,469.

Answer 2

Calculate Annual Salary

Answer 3

4

Answer 4

This Site Might Help You.

RE:
How to calculate monthly income based on annual salary?
Let's use this example - 30k annual salary

Would you do:

1) 30,000 / 2080 = 14.22

14.22 x 160 (for four 40hr work weeks per month) = $2307.69 per month gross income

OR

2) 30,000 / 12 = $2500 per month gross income

The reason I asked is because in my current job, the math works...

Answer 5

The correct way is: 30K/12 - however, my job pays me over 13 months (I'm a teacher) so at the beginning of each year I won't have to work a month in the hole. Make sure you are aware of all deductions from your paycheck. Hope this helps.

Answer 6

basically go with the first one to help with your bills or expenses... most companies want you to think you make more per month but not all months have the exact amount of days but the ending figure $30,000 will be the same.

30000/52=576.93 per week
576.93/40=14.23 per hour

hope it helps

Answer 7

you are a genius.