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# \$32 an Hour is How Much Per Year?

You have just received a job offer with a pay rate of \$32 per hour, which is a significant improvement on your old rate. However, to assess its genuine value, it is important to calculate your total earnings per year and the salary you will receive after tax deductions. Fortunately, a few simple calculations are all that are required.

So, I decided to take a closer look at the necessary formulas to convert your hourly wage to an annual income. In addition, I will evaluate the impact of both state and federal taxes on your earnings. I will also assess your daily, weekly, and monthly income and determine the kind of lifestyle you can achieve working full time at \$32 an hour.

Let the math begin, as we find out…

## \$32 an Hour is How Much Per Year?

To determine the annual income while working full-time at a rate of \$32 per hour, we must calculate the total number of working hours in a year. Assuming a full-time job constitutes eight hours per day, five days per week, the total number of working hours per week will be 40.

To get the maximum possible yearly hours, we multiply our weekly hours total by the total number of weeks in a year:

• 40 x 52 = 2,080 hours.

After establishing the total number of hours worked per year, we can determine our maximum annual income by multiplying it by our hourly rate of \$32:

• 2,080 x \$32 = \$66,560 per year.

If you work 40 hour weeks for a whole year, you will earn \$66,560 before taxes. But in reality, most people need to take at least two weeks off for a little vacation time to maintain their mental health. Therefore, we should deduct the hours of those two weeks from the calculation to get a more precise estimate. If you are paid per hour, this time off is usually unpaid.

• 2,080 – 80 = 2,000 hours per year.
• 2,000 x \$32 = \$64,000 per year.

### \$32 an Hour – Monthly Total

For the purpose of calculating monthly hours, we will be using a standard of four work weeks since numerous employees are paid in this duration. To obtain the total monthly hours worked, taking into account a 40-hour workweek, we can simply multiply this by the number of weeks worked in a month:

• 40 x 4 = 160 hours per month.

Once again, we simply multiply this total by our hourly rate:

• 160 x \$32 = \$5,120 per month.

### \$32 an Hour – Weekly Total

As we already know, our weekly hours total is 40, all we have to do is multiply this number by the hourly rate again:

• 40 x \$32 = \$1,280 per week.

### \$32 an Hour – Daily Income

For our calculations, we’ve taken an eight hour working day as standard. Let’s multiply that by \$32 for our daily total:

• 8 x \$32 = \$256 per day.

### After Tax Income on \$32 an Hour

To begin with, calculating your total yearly income from an hourly wage of \$32 per hour is a great first step; however, it doesn’t represent the actual amount that you will pocket after deducting the primary taxes.

Your earnings will take a significant hit due to federal income tax, social security and Medicare, and other state taxes. Therefore, it’s actually more important to calculate the exact amount of your income that will be redirected towards these taxes so you know what you’ll be left with.

### Federal Income Tax

The greatest harm to your wage packet will be caused by the federal income tax. To calculate your Income tax bill for a \$32 hourly wage, assuming full-time work for all 52 weeks in a year resulting in a total income of \$66,560, we must consult the applicable federal income tax brackets and do some basic math.

The tax brackets for this income range and the corresponding tax rates for 2023 are listed in the table below:

 2023 Federal Income Tax Brackets Corresponding  Tax Rate Tax Due \$0 to \$11,000 10% \$0 – \$11,000 = \$11,000 \$11,000 x 0.1  = \$1,100 \$11,001 to \$44,725 12% \$44,725 – \$11,001 = \$33,724 \$33,724 x 0.12  = \$4,046.88 \$44,726 to \$95,375 22% \$66,560 – \$44,726 = \$21,834 \$21,834 x 0.22  = \$4,803.48

To calculate the overall amount due, we just add up the total from each bracket:

• \$1,100 + \$4,046.88 + \$4,803.48 = \$9,950.36 Federal Income Tax owed.

### FICA Taxes

The payments you are obligated to make towards social security and Medicare make up this portion. This will deduct an additional 7.65% from your income. Let’s calculate the total owed:

• \$66,560 x 0.0765 = \$5,091.84 FICA taxes owed.

### State Income Tax

It can be a bit challenging to figure out your state income tax level. In the United States, seven states, including Alaska, Florida, Texas, Nevada, South Dakota, Washington, and Wyoming, do not charge any income tax. The remaining states impose different tax rates.

Some states have a fixed tax rate that does not depend on your income, while others have various tax brackets with different rates depending on your income level. Looking at the rates across the country, it can be gauged that if you reside in a state that levies income tax, you will be paying 4.5% of your income on average. Let’s calculate that:

• \$66,560 x 0.045 = \$2,995.20 State Income tax owed.

## Overall Tax Owed

 Tax Amount Due Federal Income Tax \$9,950.36 FICA Taxes \$5,091.84 State Income Tax \$2,995.20 Total \$18,037.40

To calculate your take home pay on \$32 an hour, we can simply deduct our total tax bill of \$18,037.40 from our gross income of \$66,560:

• \$66,560 – \$18,037.40 = \$48,522.60 net income.

In order to determine the percentage value, we need to divide the amount of tax paid by our total yearly income, and then multiply the outcome by 100:

• \$18,037.40 / \$66,560 x 100 = 27.1% of total income due in taxes.

This table shows how this tax rate will affect your hourly, daily, weekly, and monthly earnings.

 Time Period Pretax rate After-tax income  minus 26.63% Hourly rate \$32 \$23.33 Daily rate \$256 \$186.63 Weekly rate \$1,280 \$933.13 Monthly rate (4 Weeks) \$5,120 \$3,732.51 Yearly rate \$66,560 \$48,522.60

## \$32 an Hour Compared to the National Average

Assuming a full-time work schedule of 40 hours per week for 52 weeks per year, your annual income before taxes of \$66,560 would position you at around the 68th percentile compared to the incomes of other Americans. This is almost exactly the average individual income in 2022 of \$66,755. \$32 an hour is what you and the average American worker earn.

## Standard of Living at \$32 an Hour

It is possible to live comfortably on \$32 per hour, although many people manage on less. The extent to which this amount can provide for you largely depends on where you live. If you reside in an expensive metropolis like New York or Boston, you may have to live far from the city center, as housing expenses in many zip codes may exceed your means.

In rural areas or cities without exorbitant housing costs, \$66,560 a year will stretch much further. If you are the sole breadwinner and live in one of these regions, you may have a decent quality of living and even save some money for the future. Raising a family on this income is a possibility due to the escalating cost of living, but it may come at the expense of quite a bit of luxury in your life.

If so, take a look at our in-depth guides on the difference between Gross Pay vs Net PayHow Do I Convert Salary To Hourly To Calculate A Part Time Rate, or How To Get A Pay Stub?

Or maybe you need to know the difference between Part Time And Full Time HoursSalary vs Hourly Pay, or even find the best Flexible Jobs That Let You Set Your Own Hours that are available in 2023.

If you’ve got an important interview coming up, then you might be wondering How To Answer Desired SalaryHow To Counteroffer Your Salary After A Job Offer, or answer What Are Your Salary Expectations?

## Final Thoughts

Making \$32 per hour means you are earning the average American wage. Working for 40 hours every week, the gross annual salary after 52 weeks of work would amount to \$66,560. However, this amount could potentially be more based on various factors such as bonuses and overtime pay.

After the government has taken its slice, you will be left with a post-tax income of \$48,522.60. Although some postcodes may exceed your budget, with good financial management, this income should allow you to lead a worry-free life in most parts of the United States.

Happy Earnings!