Asklemmy

Lol who would hear "I'm making 50k" and think it's anything other than per year unless they just stepped out of a private jet...

I feel like this might be confusing only if you are under the age of 14 and have no idea how money or the world works...

I mean, you just basically answered your own question. People get paid hourly, weekly, every 2 weeks, monthly, and some even per sale (ie. Realtors) so the only way to have a constant measurement is yearly.

Because that's the standard and that is the wage I negotiated and my bi-weekly checks are that number/26. I didn't negotiate a per-payperiod rate.

It's what my taxation is based on.

It's what all my credit applications ask for.

Also, what you make and what you take home are really quite variable based on circumstance between 2 people making the same base wage. Retirement contributions, health care premiums, taxes, and other deductions vary from person to person.

For salaried employees it's the standard metric by which wages are measured. You don't need to guess anything. That's the standard.

For hourly employees, that would be your hourly rate. Since hours can be variable and overtime is a thing your yearly rate would be variable too.

Seriously there's nothing to guess.

Can't speak for the US, but here in Germany there often aren't 12 monthly salaries to a year. Many people get a Christmas bonus and/or a summer bonus, but just as many don't. Personally, I get paid about 13 1/4 monthly salaries a year, so telling you my yearly salary would be more accurate than the monthly amount.

Personally, I don't get paid every month, I get paid every two weeks, which means that some months I get paid twice and some I get paid thrice. Stating an annual value corrects for weird shit like this, and it's going to be consistent since it's probably how it is being tracked in the employer's accounting.

It's pretty standard in Europe too. It's what you see when filling your taxes, but very often people have bonuses, over-time, 13rd month and other things making monthly pay not relevant

AnD wHaTs ThE dEaL wItH aIrLiNe FoOd? Am I rIgHt?

Because your yearly income dictates your tax bracket.

Many people in the US are paid every two weeks, which means some months you're paid more than others.

Yearly has become standard as is hourly rate, because one is useful for taxes and the other is often directly negotiated.

As others have mentioned, a few possibilities (I'm in the US, not sure how specific this is):

• Payment isn't always monthly, it is often every two weeks. So sometimes you get two paychecks in a month, sometimes you get three.
• Compensation isn't just salary, even if you're salaried. Bonuses, stock grants, etc. might be done yearly/every 6 mo./every quarter.
• Expenses aren't always monthly. If you own a place, you probably pay property tax which isn't due every month AFAIK. If you budget for vacations, holiday travel, etc., these are costs that vary wildly month to month, but have some stability on a yearly basis.
• ETA: taxes are based on annual income, too.

I think it's probably one of those things that is stupid until you reach a point of financial success or fall into groups that consider your financial wealth important. Why it's a thing is probably because we pay our taxes once a year and that's when it's laid bare and you see how much you made. So after 10 or 20 years you kinda know what 50k a year is and if someone is talking about making that much you can understand the lack of money they have. If you friend tells you that, don't ask them out to expensive things unless you're going to pay the bill.

maybe tax related since taxes are based on annual income. if you are not hourly/salaried and you are self employed/freelance/contract your income will vary from month to month. annually seems like it can be more accurate across all those groups

"I'm making 50k". Great, now I have to guess - dollars? Monthly? Yearly? If yearly then what's the monthly paycheck? Net? Gross?

Guess? It’s called math. You want to know monthly? Divide by 12. You’re mad that you have to do math? It’s a standardized number.

Where do they do it otherwise? In Australia it's also yearly.

People might also get bonus so in some sense you get paid once a year.

I don't get paid once a month. I get paid every 2 weeks.

At a prior job, I got paid every week.

Yearly is a good baseline, and also helpful for taxes (which Americans have to do by hand because of tax preparers lobbying against the government doing it for us).

I can't even compare wages with my partner if we have to go by monthly rate.

I get paid per month, but in May I get an 8% bonus, so my monthly payment is not the same throughout the year. Then my partner gets paid every 4 weeks, and receives bonuses based on company performance in those 4 weeks. So every payment is different.

Per annum is the only way we can compare our salaries. And that's in the same country. Now try international, and it'll really difficult otherwise soon.

I live in the Netherlands.

Yearly, because over here some people get 12 salaries a year,some 13, some 14 and some even 15.

The yearly income covers that and also includes yearly or semi-yearli boni.

In my country you collect 14 salaries. So yearly salary is just the only sensible way to compare internationally.

In France we often have additional months paid, 13 or 14 months, as an additional pay check in June and December. The monthly pay doesn't account for that while the yearly one does. There are jobs also that have a variable salary depending on performance.

$50k means $25/hr because people work 2000 hours per year.

It's not just a US thing. I've never actually thought of this until this post, but I'd think it's because taxes are done annually.

Your employer says they'll give you X amount a year, but you receive X-Y into your account. It's easier to talk about X, then to worry about how Y fluctuates.

It also makes it feel as if you're making more money. Raises for a year sounds better than when you divide by 12 and get the monthly.

Monthly income won't tell the whole picture for people who are freelancers. Some professions have specific seasons where they make a ton of money, and other seasons where they make a lot less.

Because you only get a bonus once a year. You say your compensation is "$xxx with a $xx bonus".

As a freelance steadicam operator, my daily rate can vary between $2000 and $4000 per day (including my personal equipment rental). But I don’t work every day, far from it (especially during the current strikes) so a monthly rate is irrelevant. A yearly net revenue is a mettre measure.

I used to think in terms of hourly salaries until I got older and got big money jobs that are in yearly salaries.

I think it comes down to the fundamental difference of salaried jobs vs hourly jobs. Hourly depends on when you're scheduled, how long. It's typically flexible schedules, typically student jobs or generally non-career jobs. So comparing compensation with the hourly rate makes sense. The tax rate varies, the pay varies, everything sort of varies. The only reliable metric there is your actual instant compensation.

When it comes to salaried jobs, it's usually a flat pay. Sometimes I'll do some overtime, sometimes I do less to compensate for the overtime. The actual hourly rate becomes less relevant, because the hourly rate varies a bit as a result. But also it's no longer a calculation of "I got X hours this week, I can pay for Y expense when I get my paycheck". I get paid the same every time, and I care more about whether I'll overdraft than really how much money I earn per hour. It stops being a useful metric to me. What's $2/h do for me? Can I afford a new TV with that? Then there's bonuses typically given as one time payments, lots of one time big expenses on the house. Maybe it cost me 2 months worth of salary and I'll pay it over 6 to make it work, but I can look back at the expenses in the year and have a good picture of my expenses overall.

In the end, taxes are yearly income, and a year is a decent period for spiky expenses to wash out. I earn X a year, I get taxed Y on it, my expenses were Z, and I have W savings that went into retirement. I don't really have a use for looking at my expenses weekly/bi-weekly/monthly.

Yearly salaries are assumed in local currency (so USD in the US, CAD in Canada), and the gross amount. Because my friend in Ontario might make the same salary as I do in Québec, but we're taxed differently, but we can still compare absolute compensation. Same in the US, it varies by state. You may have more or less deducted for various things, maybe you owe back taxes, maybe you owe child support, maybe you have a more expensive insurance plan, maybe you're throwing more in your retirement plan. But total gross yearly compensation is the same, and includes pretty much everything: tax returns, tax dues, bonuses.

Another example: I'm throwing a lot of money on my retirement account. In Canada, this is non taxable income. But taxes are taken out of your paycheck. So everything I put in an RRSP turns into an implied tax return which is once a year. I get less net income during the month, but higher net income with the tax return. The only accurate numbers are the overall net and gross yearly income.

Makes it easier to figure out potential tax burden

Permanently Deleted

"I'm making 50k". Great, now I have to guess - dollars? Monthly? Yearly? If yearly then what's the monthly paycheck? Net? Gross?

I mean surely it's obvious in that example, no?

dollars

If that's the native currency wherever you are, then of course dollars

Monthly? Yearly?

$50k/month about be $600k/year. Pretty sure you'd be able to tell if the person you're talking to made half a million dollars a year vs just above the poverty line (in the US at least) just from context, but when in doubt - it's probably safe to assume that the person you're talking to isnt in the top 1% of earners

If yearly then what's the monthly paycheck?

Yearly divided by 12? If you're in a hurry and want a rough estimate just chop a number off the right and that'll get you to within ~10% of the correct value

Net? Gross?

I've literally never heard anyone give their salary as gross outside the context of financial planning, and even then they'll always specify "after taxes" or something similar.

Other comments go into plenty of detail about why they se various conventions are what they are (yearly vs monthly, net vs gross, etc(

In Québec, the default frequency for being paid is every two weeks. Big salaries are mostly stated as yearly salary, while more menial labour is often by the hour.

I don't have an explanation, it's just what it is. But I heard over that being paid every two weeks was because people were so bad with money that they would starve every month, so they started paying us every 2 weeks instead. Go figure.

I'm sure outside the US it's even more customary, annual salaries are to include all bonuses.

Often in the US we’re quoted yearly salaries by businesses for full-time positions. They will hire us for, say, $52k per year, and that will be given as $2,000 every 2 weeks. But then if we get a $500/yr raise, they don’t tell us what the new rate is on the paycheck: we have to log into the account and see the pay stub to know what our hourly rates and biweekly paychecks actually are.

Typically, it’s hourly quotes for part-time and often full-time salaried workers, and yearly quotes for full-time, especially salary exempt. Personally, I get a yearly quote, and have to look up my stub to see what the hourly or my two week gross are.