Calculating Lost Wages For Personal Injury Cases

The success of your personal injury lawsuit hinges on precise information about the damages you suffered. So if you have such a case on your hands, you’re probably wondering about the value of it. Wouldn’t it be nice if there was a lost earnings calculator you can use to make the process easier?

Thankfully, we can help you with that!

Continue reading to learn everything about the value of your case and the best lost earnings calculator.

The impact of the injury on your finances

Pursuing a personal injury claim is the best way to successfully recover the damages you suffered. As the plaintiff, you need to ask for the exact amount of compensation you wish to receive.

Naturally, you cannot make outlandish claims. The court will review the documentation provided and determine if the compensation you seek is fair and appropriate for the injuries you suffered.

What constitutes financial losses in your case may be any of the following:

• Medical costs
• Future medical costs
• Compensation for changed plans 
• Household expenses related to your injury
• Property damage
• Lost earnings
• Future lost earnings

As you can see, some of these are easy to calculate. For example, if you had to cancel a trip to Europe due to your injury, you only have to produce the receipts for the flight or the hotel. Similarly, the costs of your treatment are a non-issue as well as you’ll receive bills that show the exact price. 

The same cannot be said about future medical costs which are quite complex to determine. If you require medical treatment for any significant amount of time following the accident, you can hire a life care planner to assist you in the process. 

While treatment can be costly, it’s nothing compared to lost earnings. If you’ve suffered a spinal cord injury, you may not be able to return to work for the rest of your life. Even if your injuries are less severe, every week you spend off work will put you under a major financial strain. Luckily, you can sue for loss of earnings regardless of if you’re a business owner or employed by a company. 

However, the hard part is knowing exactly how much future wages you have lost. 

Lost earnings demystified

Before getting down to the lost earnings calculator, it’s important to know what you’re getting into. Lost earnings can be simply defined as the financial loss resulting from your inability to work.

This is usually the part most people dread when getting injured. Besides going through the turmoil of not being able to pursue your career, you and your entire family also have to make significant changes in lifestyles to reflect the lower income.

The stress is made worse if you’ve got a mortgage.

Still, if your injury isn’t permanent, you’ll only need to calculate the amount of money you missed until you can return to work.

With permanent injuries, a simple lost earnings calculator won’t cut it because you’ll have to figure out your future lost earnings which aren’t as clear-cut, along with the current earnings you have.

Here’s what we’re talking about: if an injury leaves you unable to return to work for three months, you only need to calculate the income you could have generated in those months. With permanent injuries, you also have to account for different moving factors. 

For example, if you’re a highly-driven individual with a permanent injury, the wage you were earning at the time of the accident might not have been the same as the amount you would have been earning in a year due to promotions, bonuses, and such.

Additionally, you might also have to take into account the loss of retirement funds or pension and even Social Security benefits when filing a lawsuit for future lost wages.

How to calculate lost earnings yourself

This particular lost earnings calculator is for your current lost wages. The calculation is pretty easy whether you’re working full-time, on a salary basis, or self-employed.

Let’s break down how to calculate lost wages depending on how you receive your wage.

If you’re paid by the hour. you have to determine your hourly wage and multiply it by the number of missed hours. For example, if you work 8 hours a day, your hourly wage is $30, and you didn’t work for four days, your calculation would look like this: $30 x (8x4) = $940.

If you’re getting paid by annual salary, you’ll have to take the yearly amount and divide it by 2080 (work hours in a year). Take that number and multiply it by the missed hours. Let’s say you earn $50k a year, and you didn’t work for three days - you’ll end up with this calculation: $50k / 2080 x (8x3) = $576.

Some states may only allow you to recover the net income, while some may allow you to recoup any overtime payments, lost wage increases, bonus payments, or promotion opportunities.

Lastly, if you’re self-employed (a freelancer, sole proprietor, or contractor), you can claim lost income instead of wages. This refers to the earnings and profits you would have made if you could still work. 

This process might be a little more tricky as you’ll have to produce documents that show the amount you would have earned from the time of your accident to the time of the settlement. Additionally, you can submit different documents such as profit and loss statements, receipts, invoices, or a 1099 form (for reporting non-employment income to the IRS) to strengthen your claim.

Accuracy matters

While this lost earnings calculator will get you close to figuring out how much damage you can recover for the time being, you’ll need some professional help regarding future lost wages. 

Personal injury lawyers usually help their clients estimate a reasonable amount but if you also want to claim any future losses or recover future medical costs, even your lawyer will have to hire an expert such as a life care planner or a vocational expert. 

This process is highly technical and includes different factors such as age, physical disability, education, and employment history. 

Here at OAS, we have both vocational experts and life care planners, and we’ve helped many attorneys and their clients put together comprehensive life care plans and vocational reports. Contact us at 1-800-292-1919 or fill out our contact form to receive a service that will help you receive favorable compensation in your personal injury case.