# \$7 an Hour is How Much a Year? Before and After Taxes

In today’s economy, an hourly wage of \$7 an hour is very low for most workers. But what does \$7 an hour really equate to over the course of a year? In this article, we’ll break down the before and after tax annual, monthly, biweekly, and weekly salaries for someone earning \$7 per hour.

You’ll learn how to calculate the total yearly pay for \$7 an hour, including any overtime. We’ll discuss whether \$7 an hour is considered a livable wage with today’s high inflation. You’ll see how unpaid time off further reduces annual income when making just \$7 an hour. We’ll also overview typical jobs that pay \$7 an hour or slightly more. And we’ll look at sample budgets to evaluate if it’s possible to afford basic necessities on \$7 an hour. Understanding the true value of such a low hourly rate can better inform your career and salary negotiations. Keep reading for a full analysis!

## Convert \$7 Per Hour to Weekly, Monthly, and Yearly Salary

Input your wage and hours per week to see how much you’ll make monthly, yearly and more.

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### \$7 an Hour is How Much a Year?

If you make \$7 an hour, your yearly salary would be \$14,560. We calculate your annual income based on 8 hours per day, 5 days per week and 52 weeks in the year.

Hours worked per week (40) x Hourly wage(\$7) x Weeks worked per year(52) = \$14,560

### \$7 an Hour is How Much a Month?

If you make \$7 an hour, your monthly salary would be \$1,213.33. We calculated this number by dividing your annual income by 12 months.

Hours worked per week (40) x Hourly wage(\$7) x Weeks worked per year(52) / Months per Year(12) = \$1,213.33

### \$7 an Hour is How Much Biweekly?

If you make \$7 an hour, your biweekly salary would be \$560.

Hours worked per week (40) x Hourly wage(\$7) x 2 = \$560

### \$7 an Hour is How Much a Week?

If you make \$7 an hour, your weekly salary would be \$280. Calculating based on 5 days per week and 8 hours each day.

Hours worked per week (40) x Hourly wage(\$7) = \$280

### \$7 an Hour is How Much a Day?

If you make \$7 an hour, your daily salary would be \$56. We calculated your daily income based on 8 hours per day.

Hours worked per day (8) x Hourly wage(\$7) = \$56

## \$7 an Hour is How Much a Year?

The basic formula to calculate your annual salary from an hourly wage is:

Hourly Rate x Hours Worked per Week x Number of Weeks Worked per Year = Annual Salary

So for a \$20 per hour job:

\$7 per hour x 40 hours per week x 52 weeks per year = \$14,560

However, this simple calculation makes some assumptions:

• You will work 40 hours every week of the year
• You will not get any paid time off

Therefore, it represents your earnings if you worked every week of the year, without any vacation, holidays, or sick days.

Accounting for Paid Time Off

The \$14,560 base salary does not yet factor in paid time off (PTO). Let’s assume the job provides:

• 2 weeks (10 days) paid vacation
• 6 paid holidays
• 3 paid sick days

This totals 19 paid days off, or nearly 4 weeks of PTO.

Importantly, this paid time off should not be deducted from the annual salary, since you still get paid for those days.

So with 4 weeks PTO, the annual salary would remain \$14,560 .

## Part time \$7 an hour is How Much a Year?

Your annual income changes significantly if you work part-time and not full-time.

For example, let’s say you work 20 hours per week instead of 40. Here’s how you calculate your new yearly total:

\$7 per hour x 20 hours per week x 52 weeks per year = \$7,280

By working 20 fewer hours per week (20 instead of 40), your annual earnings at \$7 an hour drop from \$14,560 to \$7,280.

That’s a \$7,280 per year difference just by working part-time!

Here’s a table summarizing how your annual earnings change depending on how many hours you work per week at \$7 an hour:

Hours Per Week Earnings Per Week Annual Earnings
40 \$280 \$14,560
35 \$245 \$12,740
30 \$210 \$10,920
25 \$175 \$9,100
20 \$140 \$7,280
15 \$105 \$5,460

The more hours per week, the higher your total yearly earnings. But part-time work allows for more life balance if you don’t need the full salary.

## \$7 an Hour With Overtime is How Much a Year?

Now let’s look at how overtime can increase your annual earnings.

Overtime kicks in once you work more than 40 hours in a week. Typically, you earn 1.5x your regular hourly wage for overtime hours.

So if you make \$7 per hour normally, you would make \$10.50 per hour for any hours over 40 in a week.

Here’s an example:

• You work 45 hours in a Week
• 40 regular hours paid at \$7 per hour = \$280
• 5 overtime hours paid at \$10.50 per hour = \$52.50
• Your total one Week earnings =\$280 + \$52.50 = \$332.50

If you worked 45 hours each week for 52 weeks, here’s how your annual earnings increase thanks to overtime pay:

\$332.50 per week x 52 weeks per year = \$17,290

That’s \$2,730 more than you’d earn working just 40 hours per week at \$7 an hour.

Overtime can add up! But also consider taxes and work-life balance when deciding on extra hours.

Here’s a table summarizing how your annual earnings change depending on how many hours you work per week at \$7 an hour:

 Overtime hours per work day Hours Per Week Earnings Per Week Annual Earnings 0 40 \$280 \$14,560 1 45 \$332.50 \$17,290 2 50 \$385 \$20,020 3 55 \$437.50 \$22,750 4 60 \$490 \$25,480 5 65 \$542.50 \$28,210 6 70 \$595 \$30,940 7 75 \$647.50 \$33,670

## How Unpaid Time Off Impacts \$7/Hour Yearly Earnings

So far we’ve assumed you work 52 paid weeks per year. Any unpaid time off will reduce your total income.

For example, let’s say you take 2 weeks of unpaid leave. That brings your paid weeks down to 50:

Hours worked per week (40) x Hourly wage(\$7) x Weeks worked per year(50) = \$14,000 annual salary

With 2 weeks unpaid time off, your annual earnings at \$7/hour would drop by \$560.

The table below summarizes how your annual income changes depending on the number of weeks of unpaid leave.

 Weeks of unpaid leave Paid weeks per year Earnings Per Week Annual Earnings 0 52 \$280 \$14,560 1 51 \$280 \$14,280 2 50 \$280 \$14,000 3 49 \$280 \$13,720 4 48 \$280 \$13,440 5 47 \$280 \$13,160 6 46 \$280 \$12,880 7 45 \$280 \$12,600

## Key Takeaways for \$7 Hourly Wage

In summary, here are some key points on annual earnings when making \$7 per hour:

• At 40 hours per week, you’ll earn \$14,560 per year.
• Part-time of 30 hours/week results in \$10,920 annual salary.
• Overtime pay can boost yearly earnings, e.g. \$2,730 extra at 45 hours/week.
• Unpaid time off reduces your total income, around \$560 less per 2 weeks off.
• Your specific situation and location impacts taxes and PTO.

Knowing your approximate annual salary and factors impacting it makes it easier to budget and plan your finances. The next step is calculating take-home pay after deductions like taxes.

## \$7 An Hour Is How Much A Year After Taxes

Figuring out your actual annual earnings based on an hourly wage can be complicated once taxes are taken into account. In addition to federal, state, and local income taxes, 7.65% of your gross pay also goes to Social Security and Medicare through FICA payroll taxes. So how much does \$7 an hour equal per year after FICA and income taxes are deducted from your gross pay?

Below we’ll walk through the steps to calculate your annual net take home pay if you make \$7 per hour. This will factor in estimated federal, FICA, state, and local taxes so you know exactly what to expect.

### Factoring in Federal Income Tax

Your federal income tax will be a big chunk out of your gross pay. Federal tax rates range from 10% to 37%, depending on your tax bracket.

To estimate your federal income tax rate and liability:

Look up your federal income tax bracket based on your gross pay.

2023 tax brackets: single filers

Tax rate Taxable income bracket Tax owed
10% \$0 to \$11,000. 10% of taxable income.
12% \$11,001 to \$44,725. \$1,100 plus 12% of the amount over \$11,000.
22% \$44,726 to \$95,375. \$5,147 plus 22% of the amount over \$44,725.
24% \$95,376 to \$182,100. \$16,290 plus 24% of the amount over \$95,375.
32% \$182,101 to \$231,250. \$37,104 plus 32% of the amount over \$182,100.
35% \$231,251 to \$578,125. \$52,832 plus 35% of the amount over \$231,250.
37% \$578,126 or more. \$174,238.25 plus 37% of the amount over \$578,125.

For example, if you are single with \$14,560 gross annual pay, your federal tax bracket is 12%.

Your estimated federal tax would be:

\$1,100 + (\$14,560 – \$11,000) x 12% = \$1,527.20

So at \$7/hour with \$14,560 gross pay, you would owe about \$1,527.20 in federal income taxes.

### Considering State Income Tax

In addition to federal tax, most states also charge a state income tax. State income tax rates range from about 1% to 13%, with most falling between 4% and 6%.

Key Takeaways

• California, Hawaii, New York, New Jersey, and Oregon have some of the highest state income tax rates.
• Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming don’t impose an income tax at all.
• Another 10 U.S states have a flat tax rate—everyone pays the same percentage regardless of how much they earn.

A State-by-State Comparison of Income Tax Rates

STATE TAX RATES LOWEST AND HIGHEST INCOME BRACKETS
Florida 0% None
South Dakota 0% None
Tennessee 0% None
Texas 0% None
Washington 0% None
Wyoming 0% None
Colorado 4.55% Flat rate applies to all incomes
Illinois 4.95% Flat rate applies to all incomes
Indiana 3.23% Flat rate applies to all incomes
Kentucky 5% Flat rate applies to all incomes
Massachusetts 5% Flat rate applies to all incomes
New Hampshire 5% Flat rate on interest and dividend income only
North Carolina 4.99% Flat rate applies to all incomes
Pennsylvania 3.07% Flat rate applies to all incomes
Utah 4.95% Flat rate applies to all incomes
Michigan 4.25% Flat rate applies to all incomes
Arizona 2.59% to 4.5% \$27,806 and \$166,843
Arkansas 2% to 5.5% \$4,300 and \$8,501
California 1% to 13.3% \$9,325 and \$1 million
Connecticut 3% to 6.99% \$10,000 and \$500,000
Delaware 0% to 6.6% \$2,000 and \$60,001
Alabama 2% to 5% \$500 and \$3,001
Georgia 1% to 5.75% \$750 and \$7,001
Hawaii 1.4% to 11% \$2,400 and \$200,000
Idaho 1.125% to 6.5% \$1,568 and \$7,939
Iowa 0.33% to 8.53% \$1,743 and \$78,435
Kansas 3.1% to 5.7% \$15,000 and \$30,000
Louisiana 1.85% to 4.25% \$12,500 and \$50,001
Maine 5.8% to 7.15% \$23,000 and \$54,450
Maryland 2% to 5.75%  \$1,000 and \$250,000
Minnesota 5.35% to 9.85% \$28,080 and \$171,221
Mississippi 0% to 5% \$5,000 and \$10,001
Missouri 1.5% to 5.3% \$1,121 and \$8,968
Montana 1% to 6.75% \$2,900and \$17,400
Nebraska 2.46% to 6.84% \$3,340 and \$32,210
New Jersey 1.4% to 10.75% \$20,000 and \$1 million
New Mexico 1.7% to 5.9% \$5,500 and \$210,000
New York 4% to 10.9% \$8,500 and \$25 million
North Dakota 1.1% to 2.9% \$41,775 and \$458,350
Ohio 0% to 3.99% \$25,000 and \$110,650
Oklahoma 0.25% to 4.75% \$1,000 and \$7,200
Oregon 4.75% to 9.9% \$3,750 and \$125,000
Rhode Island 3.75% to 5.99% \$68,200 and \$155,050
South Carolina 0% to 7% \$3,110 and \$15,560
Vermont 3.35% to 8.75% \$42,150 and \$213,150
Virginia 2% to 5.75% \$3,000 and \$17,001
Washington, D.C. 4% to 9.75% \$10,000 and \$1 million
West Virginia 3% to 6.5% \$10,000 and \$60,000
Wisconsin 3.54% to 7.65% \$12,760 and \$280,950

To estimate your state income tax:

Look up your state income tax rate based on your gross pay and filing status.

Multiply your gross annual pay by the state tax rate.

For example, if you live in Pennsylvania which has a flat 3.07% tax rate, your estimated state tax would be:

\$14,560 gross pay x 3.07% PA tax rate = \$446.99 estimated state income tax

So with \$14,560 gross annual income, you would owe around \$446.99 in Pennsylvania state income tax. Make sure to check your specific state’s rates.

### Factoring in Local Taxes

Some cities and counties levy local income taxes ranging from 1-3% of taxable income.

To estimate potential local taxes you may owe:

• Check if your city or county charges a local income tax.
• If yes, look up the local income tax rate.
• Multiply your gross annual pay by the local tax rate.

For example, say you live in Columbus, OH which has a 2.5% local income tax. Your estimated local tax would be:

\$14,560 gross pay x 2.5% local tax rate = \$364 estimated local tax

So with \$14,560 in gross earnings, you may owe around \$364 in Columbus local income taxes. Verify rates for your own city/county.

### Accounting for FICA Taxes (Social Security & Medicare)

FICA taxes are a combination of Social Security and Medicare taxes that equal 15.3% of your earnings. You are responsible for half of the total bill (7.65%), which includes a 6.2% Social Security tax and 1.45% Medicare tax on your earnings.

In 2023, only the first \$160,200 of your earnings are subject to the Social Security tax

There is an additional 0.9% surtax on top of the standard 1.45% Medicare tax for those who earn over \$200,000 (single filers) or \$250,000 (joint filers).

To estimate your FICA tax payment:

\$14,560 x 6.2% + \$14,560 x 1.45% = \$1,113.84

So you can expect to pay about \$1,113.84 in Social Security and Medicare taxes out of your gross \$14,560 in earnings.

### Total Estimated Tax Payments

Based on the examples above, your total estimated tax payments would be:

Federal tax: \$1,527.20

State tax: \$446.99

Local tax: \$364

FICA tax: \$1,113.84

Total Estimated Tax: \$3,452.03

### Calculating Your Take Home Pay

To calculate your annual take home pay at \$7 /hour:

2. Subtract your estimated total tax payments

\$14,560 gross pay – \$3,452.03 Total Estimated Tax = \$11,107.97 Your Take Home Pay

n summary, if you make \$7 per hour and work full-time, you would take home around \$11,107.97 per year after federal, state, local , FICA taxes.

Your actual net income may vary depending on your specific tax situation. But this gives you a general idea of what to expect.

## Convert \$7 Per Hour to Yearly, Monthly, Biweekly, and Weekly Salary After Taxes

If you make \$7 an hour and work full-time (40 hours per week), your estimated yearly salary would be \$14,560 .

The \$14,560 per year salary does not account for taxes. Federal, state, and local taxes will reduce your take-home pay. The amount withheld depends on your location, filing status, dependents, and other factors.

Just now during our calculation of \$7 An Hour Is How Much A Year After Taxes, we assumed the following conditions:

• You are single with \$14,560 gross annual pay, your federal tax bracket is 12 %.
• You live in Pennsylvania which has a flat 3.07% tax rate
• You live in Columbus, OH which has a 2.5% local income tax.

In the end, we calculated your Total Estimated Tax is \$3,452.03 , Your Take Home Pay is \$11,107.97 , Total tax rate is 23.71%.

So next we’ll use 23.71% as the estimated tax rate to calculate your weekly, biweekly, and monthly after-tax income.

### \$7 Per Hour to Yearly, Monthly, Biweekly, Weekly,and Week Salary After Taxes Table

 Income before taxes Estimated Tax Rate Income Taxes After Tax Income Yearly Salary \$14,560 23.71% \$3,452.03 \$11,107.97 Monthly Salary \$1,213.33 23.71% \$287.67 \$925.66 BiWeekly Salary \$560 23.71% \$132.77 \$427.23 Weekly Salary \$280 23.71% \$66.39 \$213.61

### \$7  an hour is how much a year after taxes

Here is the adjusted yearly salary after a 23.71% tax reduction:

• Yearly salary before taxes: \$14,560
• Estimated tax rate: 23.71%
• Taxes owed (23.71% * \$14,560 )= \$3,452.03
• Yearly salary after taxes: \$11,107.97
Hourly Wage Hours Worked Per Week Weeks Worked Per Year Total Yearly Salary Estimated Tax Rate Taxes Owed After-Tax Yearly Salary
\$7 40 52 \$14,560 23.71% \$3,452.03 \$11,107.97

### \$7 an hour is how much a month after taxes

To calculate the monthly salary based on an hourly wage, you first need the yearly salary amount. Then divide by 12 months.

• Yearly salary before taxes at \$7 per hour: \$14,560
• Divided by 12 months per year: \$14,560 / 12 = \$1,213.33 per month

The monthly salary based on a 40 hour work week at \$7 per hour is \$1,213.33 before taxes.

After applying the estimated 23.71% tax rate, the monthly after-tax salary would be:

• Monthly before-tax salary: \$1,213.33
• Estimated tax rate: 23.71%
• Taxes owed (23.71% * \$1,213.33 )= \$287.67
• Monthly after-tax salary: \$925.66

Monthly Salary Based on \$7 Per Hour

Hourly Wage Yearly Salary Months Per Year Before-Tax Monthly Salary Estimated Tax Rate Taxes Owed After-Tax Monthly Salary
\$7 \$14,560 12 \$1,213.33 23.71% \$287.67 \$925.66

### \$7 an hour is how much biweekly after taxes

Many people are paid biweekly, meaning every other week. To calculate the biweekly pay at \$7 per hour:

• Hourly wage: \$7
• Hours worked per week: 40
• Weeks per biweekly pay period: 2
• \$7 * 40 hours * 2 weeks = \$560 biweekly

Applying the 23.71%estimated tax rate:

• Biweekly before-tax salary: \$560
• Estimated tax rate: 23.71%
• Taxes owed (23.71% * \$560 )= \$132.77
• Biweekly after-tax salary: \$427.23

Biweekly Salary at \$7 Per Hour

Hourly Wage Hours Worked Per Week Weeks Per Pay Period Before-Tax Biweekly Salary Estimated Tax Rate Taxes Owed After-Tax Biweekly Salary
\$7 40 2 \$560 23.71% \$132.77 \$427.23

### \$7 an hour is how much weekly after taxes

To find the weekly salary based on an hourly wage, you need to know the number of hours worked per week. At 40 hours per week, the calculation is:

• Hourly wage: \$7
• Hours worked per week: 40
• \$7 * 40 hours = \$280 per week

Accounting for the estimated 23.71% tax rate:

• Weekly before-tax salary: \$280
• Estimated tax rate: 23.71%
• Taxes owed (23.71% * \$280 )= \$66.39
• Weekly after-tax salary: \$213.61

Weekly Salary at \$7 Per Hour

Hourly Wage Hours Worked Per Week Before-Tax Weekly Salary Estimated Tax Rate Taxes Owed After-Tax Weekly Salary
\$7 40 \$280 23.71% \$66.39 \$213.61

### Key Takeaways

• An hourly wage of \$7 per hour equals a yearly salary of \$14,560 before taxes, assuming a 40 hour work week.
• After accounting for an estimated 23.71% tax rate, the yearly after-tax salary is approximately \$11,107.97 .
• On a monthly basis before taxes, \$7 per hour equals \$1,213.33 per month. After estimated taxes, the monthly take-home pay is about \$925.66 .
• The before-tax weekly salary at \$7 per hour is \$280 . After taxes, the weekly take-home pay is approximately \$213.61 .
• For biweekly pay, the pre-tax salary at \$7 per hour is \$560 . After estimated taxes, the biweekly take-home pay is around \$427.23 .

Understanding annual, monthly, weekly, and biweekly salary equivalents based on an hourly wage is useful when budgeting and financial planning. Taxes make a significant difference in take-home pay, so be sure to account for them when making income conversions. Use this guide as a reference when making salary calculations.

## What Is the Average Hourly Wage in the US?

Last Updated: Sep 1 2023

US Average Hourly Earnings is at a current level of \$33.82, up from 33.74 last month and up from 32.43 one year ago. This is a change of 0.24% from last month and 4.29% from one year ago.

Average Hourly Earnings is the average dollars that a private employee makes per hour in the US. This metric is a part of one of the most important releases every month which includes unemployment numbers as well. This is normally released on the first Friday of every month. This metric is released by the Bureau of Labor Statistics (BLS).

## What is the average salary in the U.S.?

Last Updated: July 18, 2023

The U.S. Bureau of Labor Statistics uses median salary data rather than averages to avoid skewed numbers from outlying high and low numbers. Median weekly earnings of the nation's 121.5 million full-time wage and salary workers were \$1,100 in the second quarter of 2023, the U.S.

If a person works 52 weeks in the year, then this represents a national annual salary of \$57,200.

## Is \$7 an Hour a Good Salary?

In no situation can \$7 an hour be considered a “good” salary. It sets earners well below the poverty line and affords them almost no ability to afford typical costs of housing, food, transportation and healthcare.

To provide context, \$7 an hour results in only \$14,560 per year for full-time work at 40 hours per week. The 2022 federal poverty guideline for a single adult household is \$13,590. So \$7 an hour leaves you only \$970 above the poverty line before taxes. The costs of even modest housing, food and transportation would quickly erase that small “cushion” and leave you financially destitute.

According to the Bureau of Labor Statistics, the national median hourly wage across all occupations as of 2021 was \$20.17. So at \$7 an hour, you’re earning only about 35% of the overall median wage. Even in low cost-of-living rural regions, it would be nearly impossible for a single adult to even afford basic monthly housing costs on \$7 an hour, let alone other critical expenses.

For households with dependents, \$7 an hour makes any kind of independent living essentially impossible. You’d almost certainly need government assistance, charity, and support from family or friends to prevent homelessness and meet the most basic needs of housing and food. Overall, \$7 an hour leaves workers in a state of desperate and unrelenting poverty virtually anywhere in the U.S.

## Jobs that pay \$7 an hour

Here are some of the jobs most likely to pay extremely low hourly wages of around \$7 nationally:

• Food service – Fast food workers, dishwashers, some restaurant servers if tips are poor.
• Retail – Cashiers, stockers, sales floor associates at discount retailers.
• Agriculture – Farm workers involved in crop harvesting by hand typically earn around \$7 to \$8 per hour depending on season.
• Child care – Some private child care facilities pay near minimum wage rates.
• Elder care – Home health aides may earn \$7 – \$12 per hour providing basic personal care and household help for seniors.
• Janitorial/Cleaning – Maids, housekeepers, office cleaners typically earn minimum wage or just above.
• Delivery drivers – Independent contractors for apps like DoorDash and UberEats often earn around \$7-10 per hour after gas and expenses.
• Manufacturing – Some factories pay production line workers only minimum wage with no benefits.

The majority of \$7 per hour jobs feature unstable schedules, minimal to no benefits, and high turnover. Workers have little leverage or job security and limited possibilities for advancement.

## Can You Live Off \$7 An Hour?

Attempting to live independently on \$7 an hour would prove nearly impossible. Even just affording rent would consume over 50% or more of your pre-tax earnings. After deducting taxes, you’d have only a few hundred dollars left each month for ALL other expenses including food, transportation, utilities, healthcare, clothing and essentials for survival.

To highlight the extremes:

• Average national rent for a 1-bedroom apartment as of August 2022 was \$1,137 per month. On \$7 an hour FULL-TIME, your monthly pre-tax income is only \$1,213. So average rent alone would exceed your total earnings.
• The 2022 federal poverty level for a single adult is \$1,133 per month. On \$7 an hour full-time, your monthly pre-tax income is only \$80 above the poverty line income. After taxes, you’d certainly fall below it.
• The estimated living wage for a single adult in the U.S. to meet minimum subsistence needs is over \$14 per hour in 2022. Your \$7 hourly wage leaves you far short.

Unless you can share housing with others to split costs, or you receive substantial public assistance and charity, \$7 an hour leaves you essentially unable to afford rent, food, transportation, clothing and healthcare. Homelessness and reliance on others for survival needs would be almost inevitable.

## The impact of inflation on the value of \$7 an hour

With inflation reaching its highest level since 1981, prices for housing, vehicles, food, energy, healthcare and other essential expenses are rapidly escalating. As a result, an already unlivable \$7 hourly wage diminishes further in practical purchasing power every single year. Here are some examples:

• Housing appreciation – Home prices and rental rates increased over 20% nationally in 2022, widening the gap between earnings and housing costs.
• Food inflation – Grocery prices are up 13% in 2022. Those relying on cheap processed foods feel this badly.
• Gasoline prices – Gas prices doubled from 2020 to 2022. Fuel costs can wipe out your last dollars.
• Healthcare inflation – Premiums and out-of-pocket costs for health insurance and services are up over 20% stretching budgets even further.

Without at least matching increases of 6-8% annually, your \$7 wage loses purchasing power. And most low-wage jobs rarely keep pace with actual inflation through raises meaning you face compounded hardship.

## 5 Ways To Increase Your Hourly Wage

For those stuck earning around \$7 hourly, here are some potential strategies to improve your situation:

• Learn new skills – Gain skills for better opportunities through classes, apprenticeships, certifications to boost employability.
• Increase work hours – Take overtime, extra shifts or an additional part-time job to accumulate more total earnings.
• Ask for raises – Demonstrate excellent work and ask managers for payroll increases, even small bumps help.
• Find salaried roles – Look for entry-level salaried roles like office assistants that pay set weekly or monthly amounts rather than hourly.
• Pursue promotions – Strive for supervisory or management promotions to earn beyond base hourly pay rates.
• Change industries – Switch industries to those featuring higher pay scales like technology, finance, healthcare or skilled trades.
• Relocate – Consider moving to regions with lower costs of living and more plentiful job options.

Without upgrading skills, experience and opportunities, earning significantly above \$7 per hour in your roles remains very difficult. But determined workers can still slowly improve their situations over time.

## Buying a car on \$7 an hour

Attempting to buy and own a vehicle while earning \$7 an hour is essentially impossible without outside help. Here’s a quick breakdown:

• Used car prices averaged \$28,205 nationally as of October 2022. On \$7 an hour, you’d need to work over 4,000 hours, or 2 years full-time, to gross enough earnings to buy an average used car outright.
• The average new car price is around \$48,000 – equal to over 6,800 hours or more than 3 years of pre-tax full-time earnings at \$7 per hour.
• Typical car payments range from \$400-\$700 monthly. On a \$1,200 monthly full-time pre-tax income at \$7 an hour, 50% or more of your earnings would need to go just toward a car loan leaving you unable to afford rent and other basics.
• Auto insurance, gasoline and repairs add hundreds more in mandatory monthly costs making car ownership completely unaffordable.

Without extensive savings or family assistance, vehicle ownership on \$7 an hour wages remains a total impossibility for most workers. Public transportation, walking and getting rides from others become necessary for survival.

## Can You Buy a House on \$7 An Hour?

Home ownership on an income of \$7 an hour is utterly impossible in any housing market nationally:

• The average home sales price nationally is over \$354,000 as of November 2022. A full-time worker earning \$7 an hour would need to work over 50,000 hours, or 25 years, to gross enough pre-tax income to buy an average priced home outright.
• Required down payments of 10-20% of purchase prices average from \$35,000-\$70,000 – exceeding multiple years of total pre-tax earnings at \$7 hourly. Saving this much is impossible.
• Monthly mortgage payments on a \$150,000 home with 10% down would run around \$1,150. That exceeds the entire pre-tax monthly earnings of a full-time minimum wage worker.
• Add in utilities, repairs, homeowners insurance and property taxes of \$500+ per month and home ownership requires triple or more the actual income of someone earning \$7 an hour.

Barring shared arrangements or inheriting property, home ownership is essentially impossible without huge earnings gains over a prolonged period or other extenuating circumstances.

## Example Budget For \$7 Per Hour

Here is an example monthly budget for someone earning \$7 per hour at a full-time job:

• Gross Monthly Earnings – \$1,120 (40 hrs/week x 4 weeks)

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• Taxes (estimated 15%) – \$168
• Rent – \$600 (splitting costs)
• Utilities – \$60
• Phone – \$30
• Transportation – \$50
• Food – \$150
• Healthcare – \$0 Total Expenses – \$890

Remaining Income – \$62

This bare bones budget would require splitting housing costs, having no health insurance, and receiving food assistance. There is little to no room for clothing, emergencies, or other basic expenses. And this still only allows minimal savings of \$62 monthly. Earning \$7 an hour leaves almost no possibility to afford typical life necessities without substantial assistance.

## In Summary

Attempting to live independently on \$7 per hour is essentially impossible in the modern U.S. economy. Housing costs alone would consume your entire earnings in almost any area. Those earning \$7 an hour are functionally unable to afford rent, transportation, food and healthcare without relying heavily on government assistance, charities, family support or living beyond their means. Barring major wage growth for low-income earners or substantial policy changes, \$7 per hour leaves workers in poverty with extremely bleak financial prospects for the future.