So...
based upon this data, let's do a little calculating...
We will start with a base salary of $50,000 and we will assume that this individual receives a 5% raise each year...
Year 1 $50,000
year 2 $52,500
Year 3 $55,125
Year 4 $57,881
Year 5 $60, 775
So... after 5 years, your salary has increased a little over $10,000 and if you are at the level of only receiving a 3% raise, after 5 years, you increase will be a little over $5,000...
HOWEVER...
when employers give raises, health insurance premiums also increase...
when employers give raises, the cost of living also increases...
Meanwhile, the cost of living — including food, housing, education and medical costs — increased by 2.3% over the past year alone, according to the Bureau of Labor Statistics Consumer Price Index. SOURCE: cnbc.com
What does this mean?
Well...
if your raise was 5%, after calculating the cost of living increases, then your raise was only 2.7% not 5%...
If your raise was 3%, after calculating the cost of living increases, then your raise was only .7% or less than 1%...
AND...
if and when our Federal government decides to increase the minimum wage, it will be offset by the cost of living index relative to each State... for instance, the cost of living is higher in Northern States than it would be in Southern States.
