Waiting for a Raise To Fix Your Finances? 4 Reasons Why That’s Just Irresponsible
Written by
Jamela Adam
Edited by
Rebekah Evans
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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.
Raises Aren’t Guaranteed
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.
Most Raises Are Not Much Higher Than Inflation
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.
Emergencies and Bills Don’t Wait
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.
A Raise Might Not Reflect Your True Value
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.
What To Do Instead of Waiting
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:
Ask for the Raise, Don’t Wait for It
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.
Cut Spending and Rework Your Budget
Pull up your last few months of spending and look for leaks, such as subscriptions you don’t use, impulse purchases or food delivery that’s costing more than your rent. Trim what you can, even temporarily.
Build a Backup Plan: Emergency Fund First
Even saving $25 to $50 a week can help you build a basic emergency fund. You don’t need three months of expenses overnight, just enough to stop relying on credit cards when life hits.
Switch Jobs If You’re Underpaid
If you’ve been underpaid for years, a new job could offer a faster financial boost than any internal raise. According to the Pew Research Center, the typical worker who changed jobs between April 2021 and March 2022 saw earnings jump by 9.7% from a year earlier, after accounting for inflation, whereas the typical worker who stayed saw wages fall after inflation.
Generate Another Income Stream
There are infinite ways to make money, whether online or in person. For example, you can offer freelance writing services, tutor, sell digital products or work a few weekend hours at a local cafe. This not only helps you meet your financial goals faster, but it also puts less pressure on your nine-to-five to do everything.
Take Control of Your Finances
Instead of pinning your financial future to something outside of your control, take ownership of what you can control, which is your money habits. If you haven’t already, start tracking your spending so you know exactly where your money is going each month. Then, once you’ve done that, you can start making smarter choices like building an emergency fund, setting up a budget and investing for your future.
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