$28 an hour with 20 hours of overtime: what does that actually pay?
Twenty-eight dollars an hour does not sound like a six-figure job. Worked at sixty
hours a week it is one — $101,920 a year. The interesting part is what that
costs and what it would take to earn the same money without the hours, because the honest comparison
makes the overtime look very different.
Short answer
$101,920 gross, $80,531 take-home
60 hours a week at $28/hr, single filer in Texas. To earn that in 40 hours you
would need $49.00/hr — so those 20 overtime hours are doing the work of a
$21 an hour raise.
Where the money comes from
Federal overtime is weekly: everything past 40 hours in a workweek is time and a half. At $28
that is $42 an overtime hour.
Per week
Amount
40 regular hours × $28.00
$1,120.00
20 overtime hours × $42.00
$840.00
Weekly gross
$1,960.00
Look at the proportions rather than the total. The overtime is one third of the hours
and 42.9% of the cheque. Your effective rate across the whole week is
$32.67, not $28 — and that is the number to quote when somebody asks what
you earn, because it is what every hour actually returns.
What the hours are worth as you add them
Hours a week
Gross
Take-home
Keep
Net per hour
40
$58,240
$48,976
84.1%
$23.55
50
$80,080
$65,166
81.4%
$25.06
60
$101,920
$80,531
79.0%
$25.81
The 20 overtime hours add $43,680 gross but only $31,555 in the
bank. The share you keep falls from 84.1% to 79.0%, because the extra money stacks
on top of what you already earn and is taxed at your highest rate, not your average one.
This is not a tax bracket "costing you money." You always end up
with more by working more — $80,531 beats $48,976 and it is not close. What changes is the
rate of return: each extra hour hands over more of itself than the hour before it. That is
worth knowing when you decide how many to take, not a reason to take none.
The comparison that matters
Anybody can tell you 60 hours pays more than 40. The useful question is what the hours are worth
against the alternative — earning the same money at 40 hours.
To earn $101,920 in 2,080 hours
Rate needed
Your base rate today
$28.00
Rate required at 40 hours
$49.00
So the 20 hours of overtime are carrying a $21 an hour raise on their back. Two
things follow from that, and they point in opposite directions.
The first is that no realistic raise replaces heavy overtime. Nobody is moving
you from $28 to $49. If you need $100k this year, the hours are the only route to it, and that is a
legitimate answer.
The second is that the overtime is renting you that raise, not giving it to you.
It costs 1,040 hours a year — twenty-six extra 40-hour weeks — it stops the moment the
work slows, and it does not follow you to the next employer. A rate does all three.
What to do with that
Quote your effective rate, not your base. $32.67 is what your time returns.
When a competing offer says $34 at 40 hours, that is a real comparison; "$34 beats $28" is not.
Ask for the rate while the hours are running. A raise is worth more to
somebody on overtime, because every dollar on the base is $1.50 on every overtime
hour. At 20 OT hours a week a $2 raise is worth $3,120 more a year than the same $2 at 40 hours.
Check the overtime is actually right before chasing more of it. On these
hours a single misapplied line is worth thousands — a shift differential left out of the
regular rate, or hours that never made the stub.
Budget on the 40-hour figure. $48,976 is what you keep if the overtime
stops. Fixed costs set against $80,531 become someone else's emergency when the work dries up.
Run your own hours
Enter your rate, your hours and your state. Cimplora shows the regular and overtime split with
take-home per hour, week, month and year and every deduction itemised — so you can see what
the next ten hours are actually worth before you agree to them. No account, no sign-up.
How much is $28 an hour with 20 hours of overtime a year?
$1,960 a week — 40 regular hours at $28 plus 20 overtime hours at $42 — which is $101,920 a
year gross and about $80,531 after tax for a single filer in Texas.
What is $28 an hour annually at 40 hours?
$58,240 gross and about $48,976 take-home for a single filer in Texas. The 20 overtime hours
add $43,680 gross but only $31,555 net.
What hourly rate would match 60 hours at $28 without overtime?
$49.00 an hour at 40 hours a week. That is what 20 hours of overtime is doing for you — the
equivalent of a $21 an hour raise, rented rather than owned.
Why do I keep less of my overtime?
Because it sits on top of your existing income and is taxed at your highest rate rather than
your average one. The share you keep drops from 84.1% at 40 hours to 79.0% at 60. You still end up
with far more money — the return per hour just falls.
Is a raise worth more if I already work overtime?
Yes. Overtime is time and a half on your base rate, so every dollar of raise is $1.50 on every
overtime hour. At 20 overtime hours a week a $2 raise is worth about $3,120 a year more than the
same raise at 40 hours.