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Salary Increase Calculator (Pay Raise)

Updated · Written and checked by · How we check our maths

Quick answer

New salary = current salary × (1 + raise %). A 5% raise on $60,000 is $3,000 more a year, $250 a month, for a new salary of $63,000. With 3% inflation, the real increase is about 1.9%.

Pay raise

$
%
$
%
hours

New yearly salary

$63,000

Increase per year
$3,000
Increase per month
$250
Raise percentage
5%
Real raise after inflation
1.94%
New hourly equivalent
$30.29

How this calculator works

A raise is usually quoted as a percentage of your current salary. This calculator works both ways: enter a percentage to see the new salary, or enter an offered salary to see what percentage it represents.

The real raise strips out inflation. If prices rose 3% and your pay rose 3%, your buying power hasn't changed. A raise below inflation is effectively a pay cut, which is useful context in a salary review.

Changing jobs often brings larger increases than internal raises, commonly 10–20%, so compare both when planning your next move.

The formula

New salary
current × (1 + raise %), or the offered salary
Raise %
(new ÷ current − 1) × 100
Real raise
((1 + raise) ÷ (1 + inflation) − 1) × 100

Worked example

A 5% raise on $60,000 is $3,000 a year, $250 a month, for $63,000. With 3% inflation the real raise is (1.05 ÷ 1.03 − 1) = 1.94%. At 40 hours a week the new salary is about $30.29 an hour.

Tips

  1. 01Ask for the raise you want as a number, backed by market salary data.
  2. 02Negotiate total compensation: bonus, equity, leave and remote days count too.
  3. 03Get any agreed raise and its start date confirmed in writing.
  4. 04Ask for a review date if the answer is 'not now', so the conversation has a deadline.

Frequently asked questions

What is a normal pay raise?

Annual raises are commonly 3–5%; promotions and job changes often bring 10–20%.

How do I calculate a raise percentage?

Divide the new salary by the old one, subtract 1 and multiply by 100. $63,000 ÷ $60,000 − 1 = 5%.

How much more will I take home after a raise?

Less than the headline figure, because tax and deductions apply to the extra pay. Roughly 60–80% of the raise usually reaches your bank account, depending on your tax bracket.

Does a raise keep up with inflation?

Only if the raise percentage is higher than inflation. The real raise figure above shows the difference.