Pay Raise Calculator — new salary and real raise

How it works

The nominal side is simple percent arithmetic: the raise amount is your salary times the raise rate, and the new salary adds it on. The part worth pausing on is the real raise — what the increase does to your purchasing power. Prices usually rise too, so a raise only makes you better off to the extent it beats inflation. The real raise divides one plus your raise by one plus inflation, and it can be negative: if inflation outruns your raise, your bigger paycheck buys less than before. The inflation sweep shows exactly where that crossover sits for your numbers, turning "is this a good raise?" into a figure rather than a feeling.

Worked example

A 4% raise on a $60,000 salary is $60,000 × 0.04 = $2,400, lifting pay to $62,400 — the same percent-of-a-base method that makes a 3% commission on $260,000 come to $7,800. Adjust for 3% inflation and the real raise is 1.04 ÷ 1.03 − 1 ≈ 0.97%: real, but modest. Flip it to a 2% raise against 4% inflation and the real raise is 1.02 ÷ 1.04 − 1 ≈ −1.9% — a raise on paper, a pay cut in what it buys. These are this calculator's own arithmetic on your figures.

Frequently asked questions

How do I calculate my new salary after a raise?

Multiply your current salary by one plus the raise rate. A 4% raise on $60,000 is $60,000 × 1.04 = $62,400. The raise itself is $60,000 × 0.04 = $2,400. For a dollar raise instead of a percentage, just add it to your salary — the percentage it represents is the dollar raise divided by your old salary.

What is a "real" raise?

The raise after accounting for inflation — how much more your pay actually buys. It's (1 + your raise) ÷ (1 + inflation) − 1. If your raise matches inflation exactly, your real raise is zero: more dollars, same purchasing power. Only the part above inflation is a genuine gain.

Can a raise be a pay cut?

Yes, in real terms. If prices rise faster than your pay, your bigger paycheck buys less than before — a real pay cut despite a higher number. A 2% raise when inflation is 4% leaves you about 1.9% worse off. The dollar figure went up; your standard of living went down.

Should I use my raise to beat inflation?

Whether a raise is "enough" is a judgment this page won't make — it just shows the real figure so you can decide. As a reference point, a raise equal to inflation holds your purchasing power steady, and anything above it is real progress. What counts as a fair raise depends on your role, performance, and market, not arithmetic.

What inflation rate should I enter?

Use a recent overall inflation rate for a general estimate, or your own cost increases if they differ from the average — housing and food may rise faster than the headline rate for your situation. The comparison shows a range of inflation rates so you can see how sensitive the real raise is to the assumption.

Does this account for taxes and bracket creep?

No — both the old and new salaries here are gross, before tax. A raise can push part of your income into a higher bracket, so take-home rises by less than the gross raise, and only the amount over the bracket threshold is taxed at the higher rate. Use the income-tax calculator to see the after-tax effect.

How accurate is this, and what does it exclude?

The arithmetic is exact for the salary, raise, and inflation entered. The real raise depends entirely on the inflation figure you assume — a forecast, not a fact. It excludes taxes, bracket effects, changes to benefits or bonuses, and any one-time versus ongoing distinction in the raise.