How this calculator works
Raises compound on the previous year's salary. Inflation compounds independently to translate the future pay into today's purchasing power. Use consistent annual assumptions; actual raises and CPI changes may vary each year. No tax-year rates are used and all results are before deductions.
Formula
Future salary = current salary x (1 + growth)^years. Real future salary = future salary / (1 + inflation)^years. Years = ln(future/current) / ln(1 + growth).
Worked example
A $50,000 salary with two annual 10% raises becomes $60,500. At 2% annual inflation it buys about $58,150.71 in today's dollars.
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Frequently asked questions
Is this a forecast?
It is a scenario based on your inputs, not a prediction of pay or inflation.
Can I enter falling pay?
Yes. A negative growth rate above -100% models repeated pay cuts.
Why is real pay lower than nominal pay?
Positive inflation reduces the purchasing power of a future dollar.