Question

Your realized income from your primary job is $2,034.24/month. Your fixed expenses are 30% of your primary job’s realized income. You have a second job that pays $9.50/hr with deductions of FICA (7.65%), federal tax withholding (11.5%), and state tax withholding (7.75%). If you want to save enough in the next 10 months to have an emergency fund that will cover 5 months using only 20% of your discretionary monies from your primary job, how many hours per month do you need to work at your second job to meet your monthly savings goal?

Answer 1

Step 1 — compute monthly amounts from the primary job
- Realized income = $2,034.24/mo
- Fixed expenses = 30% × 2,034.24 = $610.27/mo
- Discretionary = 2,034.24 − 610.27 = $1,423.97/mo
- 20% of discretionary saved from primary job = 0.20 × 1,423.97 = $284.79/mo

Step 2 — emergency fund target and monthly savings required
(Interpretation used: emergency fund = 5 months of your monthly income/expenses = 5 × $2,034.24)
- Target = 5 × 2,034.24 = $10,171.20
- Needed savings per month to hit target in 10 months = 10,171.20 / 10 = $1,017.12/mo
- Shortfall to be covered by second job = 1,017.12 − 284.79 = $732.33/mo

Step 3 — net pay per hour at second job
- Gross hourly = $9.50
- Total deductions = 7.65% + 11.5% + 7.75% = 26.90%
- Net hourly = 9.50 × (1 − 0.269) = 9.50 × 0.731 = $6.9445 ≈ $6.94/hr

Step 4 — hours needed per month
- Hours = 732.33 / 6.9445 ≈ 105.5 hours/mo

Answer
You need about 105.5 hours per month at the second job (round up to 106 hours/month).

If you instead meant the emergency fund should cover 5 months of only your fixed expenses, the required hours would be much smaller (~2.9 hrs/mo). If you want, I can recalc using a different interpretation of “5 months” or different rounding.