How To Calculate Your Personal Break-Even Rate

Use the personal break-even rate calculator to find out how much you must make to take the job.


Personal Break Even Rate

Breaking This Break-Even Rate Down

What this Personal Break-Even calculator is telling you is what hourly rate you must earn every hour you work during the month to cover all of your expenses.   There are many nuggets of gold buried in this calculation.  For instance, Let’s say your expenses are $1,600 a month (not likely, I know, but bear with me).   That means you would only need to earn $10 an hour to cover your expenses.  But what if you earn $30 bucks an hour?  How many hours a month would you need to work to cover all of your expenses?  Don’t you love word problems.

The math on this is simple, just divide $1,600/30=53 hours.  That means you need to work 53 hours before you break-even during the month, and the remaining 107 hours can go toward savings. 

Decide How Much You Want Need To Earn

Have you wondered how much you would have to make per hour to earn a million dollars per year?  Why a million?  After all, how likely is it that anybody earns a million dollars a year?  As it turns out, in the U.S., there are lot of people who earn that much.   So let’s do the math.  First off, you should know there are 2080 available work hours in a year (according to the US Government and accountants).  So now you just divide $1,000,000/2080=$480.76 Per Hour. 

OK, so maybe a million dollars a year is hard to wrap your mind around.  Well, let’s try a more common $100,000 per year income.   That works out to be $48 Per Hour. 

So the next time a recruiter calls you and ask ‘what’s your rate’, you now have a tool you can answer with. 

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