1. What is a 3% Raise?

A 3% raise is a salary increase where your current pay is multiplied by 1.03 (100% + 3%). This is a common annual cost-of-living adjustment (COLA) or merit increase percentage.

2. How the Calculation Works

The calculation uses a simple formula:

Example: If your current salary is $50,000:

• $50,000 × 1.03 = $51,500
• The raise amount would be $1,500

3. Importance of Salary Raise Calculations

Details: Understanding how raises compound over time helps with financial planning, career negotiations, and evaluating job offers.

4. Using the Calculator

Tips: Enter your current salary in dollars (without commas). The calculator will show your new salary after a 3% increase.

5. Frequently Asked Questions (FAQ)

Q1: Is 3% a good raise?
A: 3% is typical for cost-of-living adjustments. Merit raises may be higher, typically 3-5% for average performance.

Q2: How does this compound over multiple years?
A: Three consecutive 3% raises would multiply your salary by 1.03 × 1.03 × 1.03 = ~1.0927 (9.27% total increase).

Q3: Is the raise calculated on gross or net salary?
A: Raises are calculated on gross (pre-tax) salary. Your take-home pay increase may differ based on tax brackets.

Q4: What if I get different raise percentages?
A: Replace 1.03 with (1 + raise percentage). For a 5% raise, multiply by 1.05.

Q5: How does this compare to inflation?
A: A 3% raise maintains purchasing power if inflation is 3%. Higher inflation means your real income may decrease.