Asklemmy

What's up with yearly salaries not keeping up with inflation?

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.

This must be very regional. Additionally, I’d bet a lot of this might depend on industry.

Someone who’s hourly might have fluctuations in their hours over a set period of time, like a month, or even week to week.

Seems like a number should always be coupled with a unit.

Because taxes are paid yearly. You tally your yearly income to file your taxes.

Because it's easier to compare yearly salaries. If you say “I’m making 50k” then I can assume it's yearly (if it's monthly then good for you, but that's overwhelmingly not the case). Otherwise you need to specify the pay frequency and do math.

Same with net/gross. I can assume your yearly salary is given in gross because net introduces a bunch of variables with tax rates based on location/deductions that makes it a fairly meaningless value to compare against. Not to mention your net monthly income may change in a year as you hit certain tax limits like the max social security tax limit.

Some people may also not have consistent monthly earnings so averaging income over a year gives a more accurate picture of average income.

In Spain it is also yearly. In general the annual salary is divided in 14 payments, unless you ask to have it divided by 12, depends on the employer, so it makes sense.

The income tax is also annual based. So depending how much you earned during the fiscal year you have a different tax rate. (And part of the income tax rate is dependent on the "state" but they are all more or less similar).

I think most answered your question with one exception. Dollars? What else you expect it in? Cats?

(Ignoring you will want it in the country of your residence)

Happens in germany too. A lot of people get a special salary at the end of the year, Christmas money if you will, and that also accounts into the yearly salary. If I earn 4K a month, I earn 48K a year, but if I get 100% christmas money, I earn 52K.

If you know the yearly, then that is the allotted amount in the company budget for you. So, in the big picture, you are being paid yearly. Especially if you are salary or contract. I have switched to making a yearly budget with monthly categories, and the yearly costs are much easier to factor into. My budget became more simplified and less stressful. Also, another benefit is that I save for an average cost that is usually higher than most months, and the high cost months are less troublesome to plan for.

I try to calculate net income: deductions and taxes removed from gross income. Overall, I feel better as I can plan ahead of time and don't need to do it every month. Still need to keep an eye on following the plan and for anything that changes it. I don't just plan it either, I execute it.

My income varies enough that the yearly total is a better picture than the last two or four weeks are.

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.

Wwll, I get 14 monthly payments a year, so two times a year the double amount, plus a yearly bonus, plus a fixed one time payment, so monthly would simply not represent how much i get yearly.

In my last three jobs, I was paid weekly, then bimonthly, and currently every two weeks. Weekly and every two weeks is easy to convert, but bimonthly my pay would fluctuate slightly.

There are also yearly bonuses and similar that would not be included.

Generally the people you’re telling your salary are people in the same location as you or at least the same state.

Telling the yearly salary makes the most sense there since it should be similar weekly/monthly amounts. And even if they aren’t in the same place and it doesn’t translate based on tax differences, telling someone the monthly or weekly payment would make no sense.

It's not as useful for day-to-day budgeting as a more granular one, but people generally only look at their finances closely once a year at tax time and so it's a good point of comparison for that; get a sense of how your financial life is evolving.

It's also the number you're asked for on tax forms, other financial forms (loans, financial aid, bank accounts), questionnaires (though you can lie or 'prefer not to say' on those)... comes up a lot, basically.