How the Raise Calculator Works
Most online raise calculators just show you the gross difference between two salaries — which you could work out with simple subtraction. What you actually want to know is how much bigger your paycheck will be, after taxes and deductions. That's what this tool estimates.
It works by deriving your effective net pay rate — the share of your gross salary you currently keep after taxes, insurance, and other withholdings. You get that rate by dividing your current annual take-home (your per-paycheck net pay multiplied by the number of pay periods) by your current gross salary. The calculator then applies that same rate to your new salary to project your new take-home, and adjusts for any change in 401(k) contributions. The result is a realistic per-paycheck estimate rather than a misleading gross number.
Gross Raise vs. Take-Home Raise: Why They Differ
The single most common surprise after a raise is that the bump in your paycheck feels smaller than the percentage you were quoted. A 10% raise rarely means 10% more money in the bank. There are three reasons:
- Progressive tax brackets. US federal income tax is marginal — the extra income from your raise is taxed at your highest bracket, which is usually above your overall average tax rate. So the new dollars are taxed harder than your existing ones.
- Payroll taxes scale with pay. Social Security and Medicare are a percentage of earnings, so they rise alongside your salary (until the Social Security wage cap).
- Percentage-based deductions grow too. If your 401(k), HSA, or insurance premiums are set as a percentage of salary, the dollar amounts increase with the raise — diverting a little more before it reaches your take-home.
None of this means a raise isn't worth it — it absolutely is. It just means the right expectation for a 10% gross raise is closer to a 7–8% bump in take-home, depending on your bracket. Curious where those withheld dollars actually go? Our Where Your Taxes Go tool breaks down a paycheck's federal tax by category.
How to Use This Calculator
- Current annual salary — your gross pay before any deductions.
- Pay frequency — how often you're paid, so the math matches your paycheck.
- Current take-home per paycheck — the net amount that actually hits your bank account (check your latest pay stub). This is what calibrates the estimate to your real situation.
- New annual salary — the offer or new figure you're evaluating.
- 401(k) (optional) — toggle this on to model how a percentage or flat contribution changes the picture.
What Counts as a Good Raise?
Context helps you judge an offer. Typical ranges in the US look like this:
| Type of raise | Typical range |
|---|
| Standard annual / merit raise | ~3–5% |
| Cost-of-living adjustment (COLA) | Tracks inflation (~2–4%) |
| Promotion | ~10–15% |
| Raise from a competing job offer | 10–20%+ |
A key benchmark: if your raise is at or below the inflation rate, your real (inflation-adjusted) pay is flat or falling. To genuinely get ahead, the raise has to outpace inflation.
Don't Forget the Non-Salary Side of Compensation
Salary is only part of total compensation. When you're weighing a raise or a new offer, also factor in paid time off, retirement matching, and benefits — a slightly lower salary with four extra weeks of PTO and a strong 401(k) match can beat a bigger number on paper. If you're comparing offers, our free PTO Calculator helps you value the time-off side, and the PTO Payout Calculator estimates what unused PTO is worth if you're leaving a job.
Frequently Asked Questions
How do I calculate my new take-home pay after a raise?
Find your current effective net rate by dividing your annual take-home by your gross salary, then apply that rate to your new salary. This calculator does it automatically once you enter your current salary, current take-home per paycheck, and new salary. Because tax is progressive, your take-home rises by a slightly smaller percentage than your gross raise.
Why is my take-home raise smaller than my percentage raise?
Income tax is progressive, so the extra income from a raise is taxed at your highest marginal rate — higher than your overall average rate. Payroll taxes and percentage-based deductions like a 401(k) also scale up with the bigger salary. So a 10% gross raise usually adds somewhat less than 10% to take-home.
What is a good annual raise?
A typical merit raise is about 3–5%, roughly tracking inflation. A promotion or a competing-offer raise is often 10–20% or more. A raise at or below inflation is effectively a pay cut in real terms.
Does a raise affect my 401(k) contribution?
If your contribution is a percentage of salary, the dollar amount automatically rises with your pay. If it's a flat dollar amount, it stays the same. Toggle the 401(k) option on to model either so your estimate reflects it.
Is this estimate exact?
No — it's an estimate based on your current effective net pay rate. It doesn't recalculate exact tax brackets or fixed per-paycheck deductions, so a large raise that pushes you into a higher bracket may take home slightly less than shown. Confirm with a pay stub or your payroll department once the raise takes effect.