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Salary hike calculator

  

Monthly salary before any tax. The real raise is the hike after taking inflation out, which shows what you can actually buy with it.

I know

60 thousand

%
%

New monthly salary

₹66,000

₹6,000 more a month, ₹72,000 a year. After 6% inflation the real raise is 3.8%.

Hike
10.00%
Extra per month
₹6,000
Extra per year
₹72,000
Real raise
3.8%

Reading an increment properly

A hike letter gives you a number, but the number that matters is what it does to your life. Two measures help: the extra in rupees, and the raise after inflation.

Suppose you earn ₹60,000 a month and get a 10% hike. The new salary is ₹66,000, that is ₹6,000 more each month and ₹72,000 more in a year. If prices rose 6% over the same year, your real raise is not 4%. It is about 3.8%, because the two effects multiply: 1.10 ÷ 1.06 = 1.038.

A common trap is the percentage on a part of pay. A 10% increase on basic only, when basic is 40% of CTC, is a 4% rise on the total. Ask which figure the hike applies to.

When you compare a job offer, use the same maths. Moving from ₹60,000 to ₹72,000 is a 20% hike. But the offer may come with a lower variable or higher cost of living, so compare fixed pay, location and benefits and not just the headline.

Sources

What this calculator does not account for

  • Changes in tax, bonus and variable pay.
  • Which pay components the hike applies to.
  • Your personal rate of inflation.

How this is calculated

Formula: Hike and real raise

hike % =(new − current) ÷ current × 100; real raise =(1 + hike) ÷ (1 + inflation) − 1

What the symbols mean

  • currentYour present monthly salary.
  • inflationYearly price rise to adjust against.

Good to know

Read the full methodologyFound an error? Contact us

Worked examples

Each example is worked out by the same code as the calculator above.

₹60,000 with a 10% hike and 6% inflation

New salary ₹66,000. Extra ₹6,000 a month and ₹72,000 a year. Real raise about 3.8%.

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Questions

How do I calculate a hike percentage?

Subtract the old salary from the new, divide by the old, and multiply by 100.

What is a good hike?

Anything above the inflation rate raises your buying power. In India, hikes of 8% to 12% at the same employer are common, with larger jumps for a job change.

What is a real raise?

The hike after prices have gone up. A 10% hike with 6% inflation is a real raise of about 3.8%, not 4%.

Is the hike on CTC or take-home?

Usually on CTC. Take-home depends on the components and on tax, so see the salary calculator.