Pay Raise Calculator
Your new salary after a raise, in percent or amount, and what it’s worth after inflation.
Good to know. A 3% raise in a year of 3% inflation buys exactly what last year’s pay did. It’s a thank-you, not a raise.
How it works
In plain words
A percentage raise is your salary times the percentage. The real raise compares your pay growth with price growth: divide 1 plus the raise by 1 plus inflation, then subtract 1.
The formula
new salary = salary × (1 + raise ÷ 100) real raise = (1 + raise) ÷ (1 + inflation) − 1
Worked example
A 5% raise on 50,000 is 2,500 more, so the new salary is 52,500.00, or 208.33 more a month. With 3% inflation, the real raise is 1.05 ÷ 1.03 − 1 = 1.94%.
Sources
No outside data or rates: this is plain arithmetic.
3 automated tests check its answers on every change.
About the pay raise calculator
A raise is usually announced as a percentage, but what you notice is the amount: in your yearly salary and on your monthly payslip. This calculator shows both, whichever way the raise was given. Enter an amount instead of a percentage and it works out what percentage that is.
The real raise is the part that matters for your standard of living. If prices went up 3% over the year, a 3% raise only keeps you where you were; a 5% raise gives you about 2% more buying power. That is why a raise below inflation is, in effect, a pay cut, even though the number on the payslip goes up.
When comparing a raise with a job offer elsewhere, look at total pay: bonuses, pension contributions, health cover and paid leave can be worth more than a few percent of salary. And remember that the figures here are before tax, so the increase in your take-home pay will be smaller than the increase in salary.
A useful habit is to ask for a raise in terms of the percentage and check it in terms of the amount. Negotiating from 50,000, the difference between a 3% and a 5% raise is 1,000 a year, and it compounds with every future raise built on top of it.
Questions people ask
How much is a 5% raise?
Your salary times 0.05. On 50,000 a year that is 2,500 more, or 52,500 in total.
How do I work out what percentage my raise is?
Divide the increase by your old salary and multiply by 100. 2,000 on 40,000 is a 5% raise.
What is a real raise?
Your raise after taking inflation into account. With a 5% raise and 3% inflation, your buying power grows by about 1.94%.
Is the increase before or after tax?
Before tax. Your take-home pay rises by less.