What is a good pay rise to beat inflation?

Your pay rise should at least match the inflation rate to maintain purchasing power. Aim for 1-2% above inflation for a real increase.

How is CPI calculated?

The ABS measures price changes for a 'basket' of goods and services that typical Australian households buy, including food, housing, transport and healthcare.

Why does my salary feel worth less?

If your salary hasn't increased at the same rate as inflation, you're experiencing a real-terms pay cut even if your nominal salary stayed the same or increased slightly.

Inflation Impact Calculator

See how inflation has affected your salary's purchasing power over time

Enter your salary and the dates to compare. This calculator shows you how much your salary is really worth today after accounting for inflation.

Salary & Dates

Enter your salary and the dates to compare

Salary ($)

The salary amount you received at the start date

Start Date

When you received this salary

Comparison Date

The date to compare purchasing power (usually today)

Your Results Will Appear Here

Enter an amount and time period above to see how inflation affects purchasing power.

How to Use This Calculator

1Enter your salary amount (e.g., what you earned in a past year)
2Select the start date (when you earned that salary)
3Select the end date (today or another comparison point)
4See how much your salary is worth in today's dollars after inflation

How Does Inflation Affect Your Salary?

Inflation measures how much prices rise over time. If your salary stays the same while prices increase, your purchasing power decreases. A dollar today buys less than it did five years ago.

This calculator uses the Consumer Price Index (CPI) to show how inflation has affected your salary's real value. If your pay rises haven't kept pace with inflation, you're effectively earning less than before.

Understanding Inflation

CPI: The Consumer Price Index measures the average change in prices paid by households for goods and services over time.
Real vs nominal wages: Nominal wage is your actual dollar amount. Real wage is adjusted for inflation and reflects true purchasing power.
Inflation rate: Australia has averaged around 2-3% inflation historically. Recent years have seen higher rates (6%+ in 2022-23).

Using Inflation Data

•When negotiating pay rises, factor in inflation to maintain your living standard
•A 3% pay rise during 5% inflation is actually a real-terms pay cut
•Compare job offers in real terms, not just nominal salary figures
•Use this calculator before performance reviews to understand your position

Frequently Asked Questions

Official Sources

Estimates only. Not financial or tax advice. Full disclaimer for your rights and our limitations of liability.

About this calculator

This calculator exists to show you the arithmetic. It applies published Australian rates, thresholds and formulas to the numbers you enter and shows the working, so you can check it. That is all it does — it produces a number and describes what the number is. It does not recommend anything and it holds no opinion about any financial product.

What can move this result

It only knows the figures you type in. Offsets, deductions, prior-year losses, other income, your partner's position and anything you have not entered are not in the result, and any of them can move it a long way.
Rates and thresholds change, sometimes mid-year and occasionally with retrospective effect. Each calculator shows the financial year and the verification date it is working from — outside that year the result is wrong rather than approximate.
Assumptions are set to a reasonable default and every non-statutory one can be changed. Defaults are not predictions, and a small change to a growth or inflation assumption compounds into a large change in a long projection.
Where a result reaches two or more years into the future it is shown in today's dollars as well as future dollars, because a future-dollar figure overstates what the money will actually buy.
It is a generic calculator. It is not built around any particular product, it does not compare the market, and it cannot tell you whether a product is suitable for you.

This calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. Before you make a financial decision, consider obtaining advice from someone who holds an Australian Financial Services Licence. We do not, and we cannot advise you.

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About this calculator

What can move this result

It only knows the figures you type in. Offsets, deductions, prior-year losses, other income, your partner's position and anything you have not entered are not in the result, and any of them can move it a long way.
Rates and thresholds change, sometimes mid-year and occasionally with retrospective effect. Each calculator shows the financial year and the verification date it is working from — outside that year the result is wrong rather than approximate.
Assumptions are set to a reasonable default and every non-statutory one can be changed. Defaults are not predictions, and a small change to a growth or inflation assumption compounds into a large change in a long projection.
Where a result reaches two or more years into the future it is shown in today's dollars as well as future dollars, because a future-dollar figure overstates what the money will actually buy.
It is a generic calculator. It is not built around any particular product, it does not compare the market, and it cannot tell you whether a product is suitable for you.