Your new salary
$57,750
+$2,750/yr
•
5.0%
| Period | Old | New | + |
|---|
What this calculator does: A pay raise calculator shows your new salary, the after-tax increase per paycheck, and whether your raise beats inflation — the "real raise." Formula: Real raise % = Nominal raise % − Inflation rate.
How to calculate a pay raise
- Identify your current salary and pay period.
- Determine the raise — as a percentage, flat dollar amount, or new salary figure.
- Multiply current annual salary × raise percentage to get the gross annual increase.
- Subtract federal income tax (marginal rate), Social Security (6.2% up to the wage base), Medicare (1.45%), and any state income tax to estimate net take-home increase.
- Compare the raise % to current inflation to find your real raise.
What is a good pay raise in 2026?
A raise is "good" if it exceeds the inflation rate. In 2026, with CPI-U around 3.3%, a raise above that is real income growth. Above 5% is a strong raise. The average US salary increase in 2026 is 3.5% total / 3.2% merit-only, per Mercer and WTW.
Pay raise after taxes — what you actually take home
Your raise is taxed at your marginal rate — the rate on the next dollar you earn — plus FICA (Social Security 6.2% + Medicare 1.45% = 7.65%) and any state income tax. The marginal rate matters, not the average rate. A common myth is that a raise can push you into a higher bracket and reduce take-home pay — that's false. Only the income above the bracket threshold is taxed at the higher rate.
Example: A $90,000 single earner with a 5% raise to $94,500 stays in the 22% federal bracket. The $4,500 raise is taxed at 22% federal + 7.65% FICA = 29.65%. Net annual increase: ≈ $3,166. Net per biweekly paycheck: ≈ $122.
How inflation erodes your raise — the real raise
If you got a 4% raise but inflation was 5%, your purchasing power dropped 1% — even though your paycheck got bigger. That's the gap most pay-raise tools ignore. The "real raise" formula is simple: nominal raise % − inflation %. With 2026 CPI-U at 3.3%, a 3% raise is a small real pay cut; a 5% raise is a real raise of about 1.7%.
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Should you stay or switch jobs for a raise?
Average internal raises run 3–5% per year. Average switching raises run 10–20%. Compounded over 5 years, the gap is typically tens of thousands of dollars. The Stay vs. Switch calculator above shows the math for your salary. The trade-off: switching has real costs — losing tenure, vesting, relationships, and stability — that don't show up in salary.
How to negotiate a pay raise
- Research market rate first — Levels.fyi, Glassdoor, LinkedIn Salary. Walk in with a number.
- Ask for a specific figure, not a range. Ranges anchor low.
- Use "I want $X because…", not "I feel I deserve…" Tie it to value delivered.
- Time it after a win, not during budget season or layoffs.
- Have a competing offer if possible — but only if you'd actually take it. Don't bluff.
- Calculate the net target first. Knowing you need a 6% gross raise to net $200/month more is more persuasive than "I want more."
- Negotiate beyond base salary: bonus, equity, title, remote, learning budget. Sometimes those move when base can't.
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Frequently asked questions
How do I calculate my pay raise percentage?
Pay raise % = (new salary − old salary) ÷ old salary × 100. $55,000 → $57,750 = 5%.
How much will a 5% raise increase my paycheck?
On $55,000, a 5% raise = $2,750/yr gross = ~$106 per biweekly paycheck gross. Net is typically $70–85 depending on state and bracket.
Does a raise affect my tax bracket?
Only income above the bracket threshold is taxed at the higher rate. A raise can never reduce your take-home pay. The "bumped into a higher bracket" fear is a myth.
What is the average pay raise percentage in 2026?
Roughly 3.5% total / 3.2% merit-only, per Mercer, WTW, and SHRM 2026 surveys.
How do I calculate my raise after taxes?
Multiply the gross raise by (1 − marginal federal rate − 7.65% FICA − state rate). The calculator above does this automatically.
Is a 3% raise good?
3% is roughly average. With 2026 inflation around 3.3%, a 3% raise is effectively a small real pay cut.
What's a real wage increase?
Real wage increase = nominal raise − inflation. It measures purchasing power change, not dollar change.
How much should I ask for in a raise?
Use the negotiation calculator above. Decide your target net per month, and the tool tells you the gross % to ask for.
What's the difference between a merit raise and a cost-of-living raise?
Merit rewards performance. COLA keeps pace with inflation. In 2026: merit ≈ 3.2%, COLA ≈ 2–3%.
How do I know if my raise is keeping up with inflation?
Compare to the most recent CPI-U YoY. If your raise exceeds it, purchasing power grew. If it's below, you took a real pay cut.
Can I negotiate a higher raise?
Yes. Specific number, market data, timing after a win, framed around value delivered.
Should I stay or switch jobs?
Switching averages 10–20% raises vs. 3–5% staying. The Stay vs. Switch calculator above shows the 5-year gap.