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Quick! Do you know your true net wage right now? Got the number in your mind? Before you nod your head, let me ask you about these things you may have missed.

 Your Commute Time Decreases Your True Net Wage

Many people are aware of their take-home pay figure, but they haven’t added the commute time to their workday and divided their day’s pay accordingly. For example, When I worked at the University of Pittsburgh, I commuted 45 minutes one way. My commute time adds 1.5 hours per day, so now my total is nine hours per day. You may ask, Why are you including your commute time? I am restricted in how I can use that time.

Unless you are reimbursed for mileage, fuel, and maintenance at 55 cents per mile, that cost is also decreasing your net wage. If you have a long commute that is adding more than average mileage per month, consider purchasing a vehicle with excellent gas mileage. Leasing a car in this situation can cause additional costs as well. Check out this post for more information on your car lease or purchase.

Are Your Parking Fees Deducted From Your Take-home Pay?

Net wage parking costs








Some organizations that charge for parking will offer to take it out of your pay before taxes, which amount to your tax rate in savings, but if you pay out of pocket for your parking, you must reduce your daily take-home pay by the daily parking fee, then divide that by the total hours away from home to get your true net wage.

Unpaid Breaks (Like Lunch), and Preparation Time

If you have an unpaid lunch you would add that time to your total workday when determining your cost per hour. Technically, you could say that is free time, but a half hour lunch does not give much freedom to conduct your personal business.

How long does it take you to get ready? If you spend an hour showering, shampooing, shaving, applying makeup, and drying and styling your hair, you need to add that to your total of hours required for work. Again, you could say I would do all that anyway, which you might, but if I don’t bother with makeup, or styling my hair on my day off, then I am doing those things because of my job.

Daycare Costs Must Be Deducted From Your True Net Wage

Your daycare costs are yet another deduction from your true net wage. Wait, did you include the commute time to and from daycare as well?

Lunches and Snacks

Now if you pack your lunch, you won’t need to add these costs to your total work-related expenses, but if you go out for lunch, stop for coffee on the way into work, or raid the vending machine for a late afternoon snack, you will need to deduct these expenses from your net wage. My husband takes leftovers to work to save money, so I make enough servings to allow for leftovers in my meal plan from Myfreezeasy.

Clothing/Uniform Costs

Are you required to purchase specific clothing to wear to work? When I worked at Pitt, my department supplied our polo shirts, but I was responsible to provide the pants. (Usually khaki or navy pants) Again, if you wouldn’t typically buy it if you didn’t work there, it should be deducted from your net wage. We also were required to wear closed-toe shoes, so that would be another cost to deduct.


Does your workgroup have parties to which you contribute, or celebrate birthdays, showers, promotions, or retirements? Do you buy a candy bar from your coworker’s son’s football team? It is perfectly fine to participate in any or all of these events! I did participate in a number of them. They often build morale and foster friendships.  I am just saying that you should realize that they are part of your job’s expenses.

Union Dues

Do you have union dues or do you pay to be a member of work-related business associations?

Did You Forget To Add The Value Of These Benefits?

Before you get completely discouraged, remember to add in the benefits that your company provides or partially covers. These are benefits like health, vision, dental, and even life insurance, 401k contributions. If you pay a portion, then deduct it from your net wage.

Add The Employer’s Health Insurance Contributions

My employer paid $406 of my health insurance, and I paid $367.00 in a month, so I would add in the monthly benefit of 406.00, but then deduct my own cost of $367.00 per month. Do the same for dental, vision, long-term disability, and life insurance. These costs are more difficult to determine the employer’s contribution because you may never make a claim on long-term disability or life insurance. But you are still paying for them.

Don’t Forget The Matching Contributions To Your Retirement Account

If you participate in your retirement account, you should add the employer matching funds to your net wage. If you aren’t making regular deposits to your retirement, then you are leaving free money on the table! Don’t do that!

Why Does It Matter?

So you may be wondering “Why does it even matter what my true net wage is? There are several reasons:

  1. You may be considering a job change. How will the jobs compare?
  2. You are considering a work at home job and need to determine how much net wage you need to make staying home cost effective.
  3. You find that being home and cutting costs will actually be less expensive and less stressful than paying for daycare so you can work outside the home.
  4. Your spouse gets a promotion that will require you to move, so you are trying to determine your options in a new location.

Finally, knowing your true net wage will most certainly affect your future purchases, because now you know if you really want to be spending an hour’s worth of your net wage to buy your favorite latte every day.

Calculate your true net wage here!

Real Hourly Wage Calculator

Did learning your true net wage cause you to make changes?



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