1. What is the Salary Increase Formula?

The salary increase formula calculates the new salary after a percentage increase is applied to the current salary. It's commonly used for raises, cost-of-living adjustments, and promotion salary calculations.

2. How Does the Calculator Work?

The calculator uses the salary increase formula:

Where:

• Old Salary — Current salary before increase
• Rate — Percentage increase (e.g., 5 for 5%)

Explanation: The formula converts the percentage increase to a decimal (by dividing by 100), adds 1 to represent the original amount plus increase, then multiplies by the old salary.

3. Importance of Salary Calculation

Details: Accurate salary calculations are essential for budgeting, financial planning, and understanding the real impact of raises or cost-of-living adjustments.

4. Using the Calculator

Tips: Enter your current salary and the percentage increase you expect to receive. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How do I calculate a salary decrease?
A: Use the same formula but with a negative percentage value (e.g., -5 for a 5% decrease).

Q2: Does this account for taxes or deductions?
A: No, this calculates gross salary only. Net pay would be lower after taxes and deductions.

Q3: How do I calculate multiple raises over time?
A: Apply the formula sequentially for each raise, using the new salary as the old salary for the next calculation.

Q4: What if my raise is a fixed amount, not a percentage?
A: Simply add the fixed amount to your old salary (New Salary = Old Salary + Fixed Amount).

Q5: How does compounding work with annual raises?
A: Each year's raise is calculated on the new salary, leading to compounding growth over time.