Your employer offers you a 5% raise. Sounds good — but what does that actually mean in your bank account every two weeks? A percentage is abstract; dollars are concrete. This raise calculator turns the promised percentage increase into a real new annual salary, a new monthly paycheck, and an equivalent hourly wage, so you can compare the offer against your bills, your rent, and the going rate for your role in your city.
Whether you are negotiating a promotion, reviewing an annual cost-of-living adjustment, or weighing an outside job offer, the math is the same: multiply your current pay by one plus the raise percentage, then see how much extra actually lands in your pocket each pay period.
How to Use
- Enter your Current Annual Salary — the gross yearly figure on your offer letter or most recent pay stub. Use your base salary before bonus, equity, or overtime; those belong in a separate estimate.
- Type the Raise Percentage your manager offered. A typical annual merit raise runs 2%–5%, a promotion can jump 8%–15%, and a market-driven job change often exceeds 10%. You can also enter a negative number (for example, -3) to model a pay cut.
- Confirm Hours per Week — 40 is the full-time default. Lower it if you are part-time or on a compressed schedule so the hourly equivalent stays accurate.
- Set Weeks Worked per Year — 52 for most salaried staff. Use a lower number if you take extended unpaid leave or work a seasonal contract.
The result card instantly shows your new annual salary, the extra dollars per year, the new monthly pay, the extra per month, and the equivalent new hourly wage. Slide the raise percentage up and down to see the threshold where the bump changes your real monthly cash flow.
The Raise Formula
Calculating a raise is straightforward percentage growth. If your old salary is S and your raise is r percent, your new salary is:
New Salary = S × (1 + r / 100)
The extra money you gain each year is simply:
Annual Difference = New Salary − S
For example, on a $75,000 salary with a 5% raise: 75,000 × 1.05 = $78,750. The annual difference is $3,750. Divided by 12 months, that is about $312.50 extra per month — roughly the cost of a car payment, a grocery budget, or a serious retirement contribution. If you divide the new salary by 2,080 working hours a year (40 hours × 52 weeks), your equivalent hourly wage rises from $36.06 to $37.86, about $1.80 more per hour.
That last conversion matters because many people compare offers across companies that pay hourly rather than salaried. Knowing your equivalent hourly rate lets you tell whether a competing offer of $40/hour is genuinely ahead of your current $75,000 salary.
3%, 5%, 10% — What Each Raise Is Worth
Context prevents disappointment. A 3% raise on a $60,000 salary adds only $1,800 a year — $150 a month — which may barely outrun inflation. A 5% raise on the same base adds $3,000, or $250 a month. A 10% raise on $90,000 adds $9,000 a year, or $750 a month, and lifts your equivalent hourly wage from about $43.27 to $46.51.
Company-wide cost-of-living adjustments often hover around 2%–3%. If inflation runs at 3% and your raise is 2%, your real purchasing power has actually gone down, even though your nominal number rose. Always compare the raise percentage to the current inflation rate before celebrating.
Examples
Example 1 — The standard merit increase. A designer earning $75,000 is told their annual review brings a 5% raise. The calculator sets the new salary at $78,750, adding $3,750 per year — about $313 more each month and a new equivalent hourly wage of $37.86. That is enough to max out a Roth IRA contribution and still have breathing room.
Example 2 — The promotion jump. An analyst at $60,000 moves to senior analyst with a 12% raise. The new salary is $67,200, an extra $7,200 a year, or $600 per month. Their hourly equivalent climbs from $28.85 to $32.31 — a number they can now quote when recruiting for future roles.
Example 3 — The six-figure offer. A manager at $150,000 negotiates a 10% market adjustment. The new salary hits $165,000, an extra $15,000 annually — $12,500 more per month before tax, and an equivalent hourly wage near $793. Running this number before accepting helps confirm the raise actually clears the higher cost of living that often comes with a bigger title.
Example 4 — Modeling a pay cut. If a company restructures and offers a 4% reduction, entering -4 on a $90,000 salary drops the pay to $86,400 — a loss of $3,600 a year, or $300 per month. Seeing the monthly figure makes the trade-off between staying and job hunting much clearer.
FAQ
How do I calculate my new salary after a raise?
Multiply your current annual salary by 1 plus the raise percentage divided by 100. For a 5% raise on $75,000: 75,000 × 1.05 = $78,750. The difference between the new and old salary is the extra amount you earn each year. This calculator does that instantly and also breaks it into monthly and hourly equivalents.
Is a 3% raise good?
A 3% raise roughly matches typical inflation, so it keeps your purchasing power flat rather than growing it. On a $70,000 salary it adds only about $2,100 a year, or $175 a month. A raise is meaningful when it beats inflation and the market rate for your role — anything below 2%–3% usually means your real income is declining.
What is the average raise percentage for a promotion?
Promotion raises commonly range from 8% to 15%, depending on the level jump, industry, and region. A lateral move between companies often yields 10%–20%, which is why changing employers remains the fastest way to a large salary jump even when internal merit budgets are tight.
How much is a $1 raise per hour in a year?
At 40 hours a week and 52 weeks a year, one extra dollar per hour equals about $2,080 more per year before tax. At a salary level, dividing the annual difference by 2,080 working hours converts it back to an equivalent hourly bump. This calculator shows that hourly difference automatically.
Should I negotiate the percentage or the dollar amount?
Negotiate the outcome, not the framing. A 10% raise on $80,000 is $8,000; asking for "10%" and asking for "$8,000 more" are the same conversation. It helps to anchor with a market range from sources like Glassdoor or Levels.fyi, then let this calculator confirm what the final number means per month.
Does a raise apply to gross or net pay?
All figures here are gross, before taxes and deductions. A $3,750 annual raise does not land fully in your bank account — federal, state, and FICA taxes take a share, especially because the bump may push part of your income into a higher marginal bracket. Budget with the after-tax estimate from a paycheck calculator, not the gross figure.
What if I get a bonus instead of a raise?
A bonus is one-time; a raise compounds. A $5,000 bonus helps once, but a $5,000 permanent raise adds $5,000 every year and lifts your base for future raises, 401(k) matching, and pension contributions. Use this calculator for the recurring salary piece, and treat bonuses as separate windfalls.
Disclaimer
This raise calculator is provided for informational purposes only and does not constitute financial, tax, legal, or compensation advice. Results are based on the gross inputs you enter and the standard percentage-increase formula; they ignore taxes, bonuses, equity, benefits, overtime, and cost-of-living differences. Actual pay offers depend on your employer's compensation policy, your location, and market conditions. Always confirm your final salary and total compensation package directly with your employer or a qualified compensation professional before making career or financial decisions.