Jamela Adam
4 min read
If you’re living paycheck to paycheck or drowning in credit card debt and you’re thinking, “Once I get that raise, I’ll finally get my finances together,” you’re setting yourself up for disappointment.
Even if the raise does come, it likely won’t be the magic fix you’re hoping for — here’s why.
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Nothing in life is guaranteed and that includes raises. Companies restructure. Budgets shrink. Your boss changes. Even if you’re a top performer, you might still get passed over for a pay bump. This is why tying your entire financial future to an outcome you don’t fully control is risky.
And even if you do eventually get a raise, it may not be enough to make a significant difference in your finances after accounting for inflation and the increasingly expensive cost of living.
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According to U.S. News & World Report, the average salary increases will be between 3.5% and 3.9% in 2025. Meanwhile, the inflation rate in the US is currently at 2.3% based on the Consumer Price Index for All Urban Consumers (CPI-U), as of April 2025.
That means your raise might barely cover the rising cost of living. Sure, your paycheck could be slightly higher, but so are your rent, groceries and utility bills. In the end, you may not feel any richer even if you get a raise.
Life doesn’t hit pause while you wait for human resources to process your compensation review. Emergencies still happen and bills still need to get paid. If your current budget can’t handle an unexpected expense, a raise six months from now won’t help you today.
Many companies will give you a raise that’s just enough to keep you from leaving, not necessarily what you’re worth. In some cases, you could be underpaid by 20 to 30% compared to your market value. So if you’re staying in one job and waiting around for your salary to catch up, you could be losing money in the long run.
If you want to take back control of your finances, don’t just sit there waiting for your employer to give you a raise. Here’s what to do instead:
If you’ve earned it, speak up. Set a meeting with your manager to discuss adjusting your salary. Just make sure you have solid data to support your claim about your contribution to the company, like salary research and market rate.
