Calculate your new salary after a raise and understand the real impact after inflation. See the difference between nominal and real wage growth.
Enter your current annual salary — this is the total amount you earn before any increase is applied, including base pay and any existing allowances.
Input the salary increase percentage — this is the raise you received or are expecting, expressed as a percentage of your current salary.
Optionally, enter the current inflation rate — this allows you to see the real (inflation-adjusted) purchasing power of your raise rather than just the nominal increase.
Calculate your new salary and compare the nominal increase against inflation to understand your true wage growth in terms of purchasing power.
The salary increase formula applies the raise percentage to your current salary to determine your new earnings. The real increase subtracts the inflation rate from your nominal raise, revealing how much your purchasing power actually grows. A raise that is lower than inflation means your real wages are decreasing, even though your paycheck amount increases.
An employee currently earning $65,000 per year receives a standard 3% annual raise. The increase amount is $65,000 × 3% = $1,950, bringing the new salary to $66,950. However, with inflation also at 3%, the real increase is exactly 0% — meaning the employee's purchasing power remains unchanged despite the higher paycheck.
After earning a promotion, an employee earning $55,000 receives a 15% raise. The increase is $55,000 × 15% = $8,250, resulting in a new salary of $63,250. On a monthly basis, this translates to an extra $687.50 per month ($8,250 / 12). A 15% raise is typical for promotions and significantly outpaces average inflation.
An employee earning $70,000 receives a 2% raise in a year where inflation is running at 4.5%. The nominal increase is $1,400, bringing the salary to $71,400. However, the real wage decrease is 2.5% (2% - 4.5%), meaning the employee's purchasing power actually declines despite receiving a raise. This scenario highlights why understanding inflation-adjusted growth is critical.
Find answers to the most common questions about salary increase calculator.
