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$16 an Hour Is How Much a Year?

$16 an Hour Is How Much a Year?
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Earning an hourly wage makes it hard to budget unless you annualize it or at least look at it on a monthly basis. Knowing how much you bring in each month is important; otherwise, how do you set up a budget? You need to know how much you can commit to expenses like housing, utilities, insurance, food, and savings.

If you make $16 an hour, check out our guide to make the most of it. So $16 an hour is how much a year? Continue reading to also see the equivalent annual salary based on how many hours you work.

16 Dollars an Hour Is How Much a Year?

You may find yourself asking how much is $16 an hour annually? If you work 52 weeks per year (or get two weeks of paid vacation), you will make around $33,280 assuming you work 40-hour weeks with no overtime pay.

If you don’t get paid time off and you take it, you’ll work around 2,000 hours per year, bringing your salary down to $32,000 even. But if we’re honest, there are 262 weekdays in 2020. If you worked every weekday, you’d work 2,080 hours and make $33,280 annually.

Let’s convert your hours worked to salary based measurements:

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Check out our free Hourly to Salary Calculator to further dive into your hourly pay.

For both salaried and hourly employees, the fair labor standards act, and the department of labor standards provides you with a level of protection. Federal minimum wage (minimum rate of pay for a given nonexempt job role) and for overtime hours on time-spent if an employee meets compensatory requirements are just two examples of how labor laws help you.

How Much is $16 an Hour per Month?

It helps to know how much $16 an hour earns you per month. You’ll have a better idea of your monthly budget and what you can spend. Using the full 366 days in 2020, the average hourly wage earner works 175 hours per month.

At $16 an hour, you’d make $2,800 per month, assuming you work all the weekdays in the month. If you take time off unpaid, the amount drops.

How Much is $16 an Hour per Week?

Do you prefer to budget weekly? Many people do; it’s easier to break it down than look at a month at a time and get overwhelmed.

$16 an hour per week means $16 an hour for 40 hours or $640. If you work overtime or take time off, it will increase or decrease your weekly income accordingly.

How Much is $16 an Hour per Day?

Want to look at it from a daily standpoint? Maybe you want to give yourself a little incentive to keep going – and what works better than cold hard cash, right?

If you work full-time, that’s 8 hours a day on average. At $16 an hour, you’d gain $128 a day.

$16 An Hour Breakdown (Comparison Table)

Here’s a quick breakdown of what $16 an hour looks like for the average person.

$16 an hour salary

Tools You Need to Live on $16 an Hour

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4 Jobs That Earn $16 an Hour

1. Butchers 

Butchers prepare meat for retail sale. They trim, cut, and prepare meats for delis and grocery stores to sell to consumers. In retail stores, butchers also wait on customers and help them choose the right cut of meat or cut specialty meats for them.

2. Retail Sales Associate 

All stores have retail sales associates. You can work for a straight hourly wage or for a store that pays a small commission to its associates. Retail sales associates assist customers, straighten aisles, and put out new inventory. 

3. Preschool Teacher 

Preschool teachers are an important part of a child’s life. If you have a bachelor’s degree in early childhood education, you could be a good candidate for a preschool teacher in a public school. However, if you don’t have a degree, some private preschools have different requirements that may allow you to work as a teacher.

4. Customer Service Representative 

Customer service representatives may work in the store, online, or over the phone. Your main job is to help customers with questions and concerns. You may process returns, help customers problem-solve issues, or answer questions about products or services.

$16 an Hour After Taxes

Making $16 an hour is what you make before federal and state income taxes. But, of course, Uncle Sam wants his part of the pie, so in reality, your take-home pay is less than $16 an hour.

Everyone has different tax situations, but for generalization purposes, let’s use 25% for all taxes (federal, state, and FICA). 

Your annual salary (take-home pay) is $24,960 after taxes. That comes to around $12 an hour if you have 40 working hours, 52 weeks a year. 

Paid Time Off Vs. No Paid Time Off

Not all hourly employees get paid time off. It’s best to plan for the worst (not getting paid time off) and figuring your annual salary with taking two weeks off. Life happens, and you will likely need some time off. If you make more than you anticipated, that’s great, but at least you’ll plan accordingly if you take it.

If you get paid time off, that’s the equivalent of making $33,280 per year, even though you only work 50 weeks rather than 52 weeks.

If you don’t get paid time off but take it (or plan for it), you’ll get paid for 50 weeks, not 52. This drops your salary to $32,000. 

Before taxes, you’d make $128 per day on the days you work, but you don’t get paid any day you don’t work.

Additional Ways to Boost Your Hourly Wage

If living on $16 an hour isn’t enough to live the life you want, here are some ways to boost your wages.

Negotiate a Raise

Don’t be afraid to ask for what you think you deserve. It helps if you do some research beforehand, though. For example, check out Glassdoor or Indeed to see the average salary for your job in your area. 

If you’re not making that wage, ask for it.

Also, list reasons why you feel you deserve the raise. For example, what have you done for the company that benefited them? This list of accomplishments could be the key to winning your boss over. 

Also, set up a formal meeting with your boss to discuss the raise. Don’t just blurt it out mid-workday when they aren’t prepared.

New Job

You aren’t stuck at your job forever. If you feel you’re worth more than what you’re making, or you’re burning out, look for a new job.

You know $16 an hour isn’t working for you, so aim higher. Look for jobs that fit your experience and criteria and see what you can land. You won’t know what you’re capable of until you try!

New Career

Even if you went to college or had some training for your current job, you aren’t stuck there forever. 

Everyone changes careers from time to time, especially if their current career isn’t good for their pocketbook or mental health.

Before changing careers, do your research. Figure out what you can do with your current skills or if you might need to return to school or get specific training to start a new career. 

This time, know what you’re getting into, especially the starting wage, since you’ll be a newbie in the industry.

Side Hustles

Side hustles are a great way to make extra cash, especially if you don’t want to leave your current job. Think about what you love doing and make a business out of it.

You can do anything from freelance writing, website design, selling your crafts, retail arbitrage, or manual work around the neighborhood, like cutting lawns or shoveling snow. 

You can work side hustles in your free time and as much or as little as you want. However, if you prefer something more steady, consider working a gig with Uber or DoorDash.

Passive Income

Passive income is money you earn while doing nothing. Most passive income ideas require some work up front, such as writing an ebook or creating a digital product to sell, but once the work is done, you continue making money off the product.

If you want something even more passive, consider investing in stocks, ETFs, or real estate. You don’t have to do anything to manage your investments and instead can earn money if and when the companies perform well.

Example Budget for $16 per Hour Pay

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When you make $16 an hour, you must budget carefully. Of course, you won’t live an extravagant lifestyle if you’re living on your own, but with a simple budget, you can make things work.

Ideally, you should keep your expenses, including rent, utilities, food, clothing, and other basic needs to 50% of your income. Then, you can divide the remaining 50% between savings, giving, and entertainment. Ideally, you’d save 20%, give 10%, and leave 20% for ‘fun money.’

16 dollars an Hour is How Much a Year FAQ

Can I Live Off $16 Per Hour?

You can live off $16 per hour, but you must be creative. For example, instead of living alone, get a roommate, or instead of buying name-brand and new clothes, shop thrift stores. You’ll need to figure out your ‘must-haves’ and where you can’t sacrifice and then sacrifice in areas that don’t mean as much to you.

Making $16 an hour, you won’t live in a high-end area, in a large house, or have a lot of disposable income, but with some creativity, you can make it work.

How Do You Calculate Hourly Rate From Annual Income? 

To calculate your hourly rate from an annual salary, take the salary and divide it by 52 weeks. Next, divide that number by 40 working hours, and you get your hourly rate.

What Is the Median Hourly Wage?

The median hourly wage in the US is $10.93 per hour.

Is $16 an Hour Good Pay?

You can make $16 an hour work if you’re frugal. If you can rent with roommates, share the utility costs, and keep food costs at approximately 10 percent of your monthly income, you should have enough to cover the basic cost of living and even saving 10 percent each month. It doesn’t leave much room for spending, but if you’re looking for more, check out our Make Money category for effective strategies to make more money!