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? rounded?

Answer 1

Step 1 — numbers from your primary job
- Primary realized income: $2,034.24/month
- Fixed expenses: 30% → 0.30 × 2,034.24 = $610.27
- Discretionary = 2,034.24 − 610.27 = $1,423.97
- 20% of discretionary available monthly for the fund = 0.20 × 1,423.97 = $284.79

Step 2 — emergency fund target and monthly need
- Target = 5 months × $2,034.24 = $10,171.20
- To build in 10 months → needed per month = 10,171.20 / 10 = $1,017.12
- Shortfall to be covered by second job each month = 1,017.12 − 284.79 = $732.33

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

Step 4 — hours needed
- Hours = 732.33 / 6.9445 ≈ 105.45 hours/month

Rounded answers
- Nearest whole hour: 105 hours/month
- If you want to ensure you meet the goal (rounding up): 106 hours/month

So you need about 105.5 hours/month — practically: work 106 hours/month at the second job to be safe.