Asklemmy

I used to think in terms of hourly salaries until I got older and got big money jobs that are in yearly salaries.

I think it comes down to the fundamental difference of salaried jobs vs hourly jobs. Hourly depends on when you're scheduled, how long. It's typically flexible schedules, typically student jobs or generally non-career jobs. So comparing compensation with the hourly rate makes sense. The tax rate varies, the pay varies, everything sort of varies. The only reliable metric there is your actual instant compensation.

When it comes to salaried jobs, it's usually a flat pay. Sometimes I'll do some overtime, sometimes I do less to compensate for the overtime. The actual hourly rate becomes less relevant, because the hourly rate varies a bit as a result. But also it's no longer a calculation of "I got X hours this week, I can pay for Y expense when I get my paycheck". I get paid the same every time, and I care more about whether I'll overdraft than really how much money I earn per hour. It stops being a useful metric to me. What's $2/h do for me? Can I afford a new TV with that? Then there's bonuses typically given as one time payments, lots of one time big expenses on the house. Maybe it cost me 2 months worth of salary and I'll pay it over 6 to make it work, but I can look back at the expenses in the year and have a good picture of my expenses overall.

In the end, taxes are yearly income, and a year is a decent period for spiky expenses to wash out. I earn X a year, I get taxed Y on it, my expenses were Z, and I have W savings that went into retirement. I don't really have a use for looking at my expenses weekly/bi-weekly/monthly.

Yearly salaries are assumed in local currency (so USD in the US, CAD in Canada), and the gross amount. Because my friend in Ontario might make the same salary as I do in Québec, but we're taxed differently, but we can still compare absolute compensation. Same in the US, it varies by state. You may have more or less deducted for various things, maybe you owe back taxes, maybe you owe child support, maybe you have a more expensive insurance plan, maybe you're throwing more in your retirement plan. But total gross yearly compensation is the same, and includes pretty much everything: tax returns, tax dues, bonuses.

Another example: I'm throwing a lot of money on my retirement account. In Canada, this is non taxable income. But taxes are taken out of your paycheck. So everything I put in an RRSP turns into an implied tax return which is once a year. I get less net income during the month, but higher net income with the tax return. The only accurate numbers are the overall net and gross yearly income.