The method
The price on the tag is the smallest number.
A drink costs nine dollars. That is what the menu says, and it is true in the narrowest possible sense — nine dollars is what leaves your account. It is also the least useful number in the transaction, because it describes a moment rather than a decision.
Five other numbers are attached to that drink, and nobody shows you any of them. This page explains what they are, how each one is calculated, and where the figures come from. It is longer than a marketing page because the idea does not survive being summarised — you have to follow the arithmetic once.
Start with the money that never arrives
Before you can spend a dollar, you have to earn it, and earning it costs money. Payroll withholding takes its share before your salary reaches you, so the money in your account is already the remainder of something larger.
Here is that chain for a single filer on $75,000 in California, in the 2026 tax year — real figures, computed by the same engine that runs the calculator:
That multiplier is the whole idea. It is not a metaphor and not a rule of thumb — it is what the withholding tables actually do. And because income tax is progressive, it is not even constant: the multiplier that applies to your next dollar is worse than the one that applies to your average dollar. A purchase is funded at the margin, so the margin is what we use.
The five costs, in order
- 1
The income you must earn
Work backwards from the price to the salary required to net it, walking the real federal, FICA, state and local brackets. Not price × 1.3 — an actual inversion of the tax code, bisected to the cent.
- 2
The tax you pay to buy it
Sales tax at your county's real combined rate, plus any excise duty, tips and mandatory fees. This is the only layer most calculators include, and it is usually the smallest of the five.
- 3
What it costs to keep
Insurance, fuel, maintenance, registration, financing interest and depreciation across a realistic holding period. A car is not a purchase; it is a subscription with a large joining fee.
- 4
What the money would have become
The same cash, invested instead, compounded at a long-run real return. Shown as an alternative to the purchase — never added to it, because it is money forgone rather than money paid.
- 5
The hours of your life
The gross figure divided by what your time is actually worth after tax. Money is abstract; a Tuesday afternoon is not.
A worked example: one drink
Take that $9 drink in California, on a $75,000 salary. Watch what happens to it.
| Menu price | $9.00 | What you thought it cost. |
|---|---|---|
| Sales tax | +$0.74 | Charged at the county's combined rate. |
| Tip | +$1.80 | Customary, and effectively non-optional. |
| Cash out of pocket | $11.54 | What actually leaves your account. |
| Salary required to net that | $18.51 | After federal, FICA and California withholding. |
Why nobody else shows you this
Not because it is secret, but because it is tedious. Doing it properly means maintaining federal brackets, FICA thresholds, fifty-one state schedules, several thousand county sales-tax rates and a dozen local income taxes — and re-verifying all of it every year against primary sources, because secondary summaries are frequently wrong.
We know they are frequently wrong because we found seven errors in our own data by checking it against the statutes: a state schedule listed as flat that is actually graduated across eight brackets, a surtax threshold that had moved, a rate a well-known source had published a quarter percentage point too high. Every one of those came from a source that looked perfectly authoritative.
The rules we hold ourselves to
- Money is integer cents, never floating point. A rounding error in a number people are meant to trust is not a small bug.
- No figure without a primary source and a date. If a rate cannot be verified against the statute or the agency that sets it, it does not ship. The data-for-nerds panel on every result names the source and when it was checked.
- Estimates are labelled as estimates. Where a national average stands in for a local figure, the result says so. An old number presented honestly beats a confident number that is wrong.
- The assumptions are yours to change. Filing status, county, tip rate, holding period, return rate — all editable. A calculator that hides its assumptions is asking you to trust it rather than check it.
What this is not
It is not tax advice, and it is not a substitute for a preparer. It models a single filer's wage income against published schedules; it does not know about your dependants, your 401(k), your itemised deductions, your capital gains or your particular circumstances — all of which move the answer, mostly downward.
The point is not to produce a number accurate to the cent for your exact situation. It is to show you the shape of a purchase — that the tag price is one of five costs, that the other four are usually larger, and that nobody was ever going to tell you.