Budgeting & Income

Pay Raise Calculator

A raise sounds great, but a 3% bump in a 3% inflation year leaves you no better off. Enter your current salary and raise to see the new figure, the increase per month, and your real raise after inflation.

Formula shown below · Tested against worked examplesHow we verify

Current salary

Raise

Inflation rate

Compare your raise to inflation to see the real gain.

New salary

$63,000

A 5% raise.

Annual increase: $3,000
More per month: $250
Real raise (after inflation): 2%

Compare scenariosTry three values of one input

Vary

Pay Raise Calculator results for three values of Current salary
Current salary
New salary	$56,700	$63,000+$6,300	$69,300+$12,600
Annual increase	$2,700	$3,000+$300	$3,300+$600
More per month	$225	$250+$25	$275+$50

Every other input stays at the value you set above — currently $60,000 for current salary. Differences are measured against the first column.

Saved scenariosSave this calculation

Name this scenario

Saved in this browser only — no account, and nothing is sent to us. Clearing your browser data deletes them.

How this calculator works

New salary = current salary × (1 + raise). The monthly increase divides the annual increase by 12. The real raise subtracts inflation from your raise percentage — the change in purchasing power.

Figures are before taxes; a raise can also push part of your income into a higher bracket, so your take-home increase is a bit less than the gross. Use the Take-Home Pay calculator for the net effect.

Formula

New salary = Old × (1 + r)
Real raise = (1 + r) ÷ (1 + i) − 1

r: Raise, as a decimal
i: Inflation over the same period, as a decimal

The second line is the one that matters. A 3% raise against 4% inflation is a real-terms pay cut, and take-home rises by less than the gross because tax and FICA apply to the increase.

What this assumes

The raise applies to gross pay; the change in take-home is smaller because tax and FICA apply to the increase.
Inflation is applied only if you enter it — a raise below inflation is a real-terms cut.
Benefits, bonus and retirement match are not automatically scaled with the raise.

What changes this number

Your marginal rate: Decides how much of the raise reaches your account. It is never the full amount, and never zero.
Inflation: The comparison that matters. A 3% raise against 4% inflation is a pay cut.
Compounding: Raises apply to the new base, so an early raise is worth more over a career than the same raise later.

A worked example

Take the 5% raise, 3% inflation scenario. These figures are produced by the calculator above, not written alongside it, so they always match what the tool returns.

What you enter

Current salary: $60,000
Raise: 5%
Inflation rate: 3%

What it returns

New salary: $63,000
Annual increase: $3,000
More per month: $250
Real raise (after inflation): 2%

Sources

This calculator uses no external data — the result follows entirely from the formula above and the values you enter, so there is nothing to cite beyond the arithmetic.

Calculator last reviewed August 9, 2026. How we verify

Try an example

5% raise, 3% inflation Raise below inflation Big promotion (12%)

Frequently asked questions

How do I calculate my new salary after a raise?

Multiply your current salary by (1 + raise percentage). A 5% raise on $60,000 is $60,000 × 1.05 = $63,000, an increase of $3,000 a year or $250 a month before taxes. This calculator also shows the after-tax reality via the linked take-home pay tool.

What is a real raise?

A real raise is your pay increase minus inflation — what actually happens to your buying power. A 3% raise when prices rise 3% leaves you flat; a 5% raise against 3% inflation is a real 2% gain. If your raise trails inflation, you've effectively taken a pay cut.

Is a 3% raise good?

It depends on inflation. In a low-inflation year, 3% keeps you slightly ahead; when inflation runs higher, 3% can mean falling behind. Average annual raises have historically hovered around 3–4%, so beating that — and beating inflation — is the real benchmark.

This calculator helps answer

What will I actually take home?

Turn a salary offer into the number that reaches your account, then check what a raise, a contribution change or self-employment does to it.