Your Real Wage
This week I have discussed how much people are actually working versus how much they are being told they are working. The forty-hour workweek is largely a myth, unless, of course, you work “30 hours” a week!
But, while we spend a large portion of our waking hours chained to our desks, we are able to make a living, earning tens of thousands of dollars a year. It represents our livelihood, and our ability to make ends meet, and to raise our children. Right? Maybe. Have you ever thought that you might be underpaid, especially for the amount of effort and time you are selling away to your employer? Chances are good that you are correct.
When you started working at your current job, they gave you a salary. Let’s say, for the purposes of this article, that you are being paid a nice sum of $60,000 per year. That comes out to $28.84 per hour. So, each hour that you work hard and sell away to your boss, you are making almost $30, right?
First, you lose a lot of this to taxes. We will pretend that you live in a state that has a medium-level income tax and see what you end up “taking home.” This website gives you the info. If you live in Virginia, and you take two witholdings and one $70 monthly deduction for health care, you will end up with $761.02 per week.
Next, let’s divide this figure by the number of hours each week that you work. Wait. Remember when I talked about the forty-hour myth? You work more than you may think. Let’s instead say that you work 53 hours and 45 minutes per week, factoring in transportation, preparing for work, and “lunch breaks” that are unpaid. (For an explanation of how I arrived at this figure, see this post.)
$761.02 / 53.75 = $14.15.
You make just over $14 an hour for your work. There is reality. And actually, if you factor in the cost of gas to get to and from your job, it will be even less than this. At some point I would like to include a calculator on this website that will let you know your real wage for the hard effort you put in every day. In the meantime, think about how many hours you are really putting in on your job, getting there and taxes, and then do the math.
You’ll probably be shocked and appalled. $60,000 a year seems like a lot, but in the end, you only end up with about two-thirds of this total. And you are actually working a lot more for what you are getting back. No wonder so many of us are in debt. Many of us don’t have a budget, and don’t live in reality. This is a deadly combination, but is also for a later post.
Hey! Why Has My Paycheck Shrunk?February 10th, 2013
Great Retirement CalculatorsFebruary 16th, 2012
Charting Your Voyage Out of the Rat RaceMay 12th, 2010
Eating Out is a Great Way to Save MoneyApril 13th, 2010
Why Won’t the Rich Share the Wealth?March 27th, 2010