Pay rises and what they are really worth

A pay rise is worth exactly what it adds to your net pay after inflation - which is rarely the number in the letter.

Three deductions from any headline rise

1. Tax and contributions. Only the after-tax part reaches you, at your marginal rate. 2. Inflation. A rise below the inflation rate is a pay cut in real terms. This is the comparison that matters over a career. 3. Cliff edges. Occasionally a rise pushes you past a point where an allowance or benefit is withdrawn. These are rare, specific and countable - and worth checking before you assume the worst.

Turning any offered rise into a monthly net figure takes thirty seconds in the mySal take-home calculator and changes how it feels.

Percentages compound; that is the real story

A 3% rise on 35,000 is about 1,050. Repeated annually it lifts pay above 40,000 within five years, and every future percentage is calculated on the larger base. Two people with identical starting salaries who negotiate 2% versus 5% diverge dramatically over a decade. Small annual differences are not small.

Asking well

• Benchmark first. Job adverts, salary surveys and recruiters give you a defensible range.
• Lead with evidence. What you delivered, what it was worth, what you took on beyond your role.
• Name a number. A specific figure anchors the conversation; "something more" does not.
• Ask about the whole package. If salary is frozen, a bigger pension contribution, extra leave or funded training all have real value.

Promotions versus rises

A promotion usually resets your band rather than nudging your salary, which is why moving up - internally or by changing employer - moves pay more than annual reviews. Both matter, but only one compounds quickly.