Why Salary Comparisons Miss the Full Picture
When you receive a raise offer and an outside offer at the same time, it is tempting to compare the two base salaries and pick the bigger number. But base salary is only one piece of total compensation. Bonuses, equity, health insurance, retirement matching, PTO, commute costs, and switching costs all shift the real comparison — sometimes dramatically.
A $15,000 salary bump at a new company can disappear entirely once you factor in forfeited unvested equity, weeks of COBRA payments, relocation costs, and a lower 401k match. Conversely, a modest 5% raise from your current employer might be the worse deal if the new company offers significantly stronger equity or benefits. The only way to know is to run the numbers.
The Hidden Value of Staying
Staying at your current job after a raise has advantages that do not appear on the offer letter. You keep your unvested equity — shares that could be worth tens or hundreds of thousands of dollars over the next few years. You retain your accumulated PTO, your established relationships, and your institutional knowledge. There is no benefits gap, no COBRA, no relocation.
You also avoid the risk premium of a new role. At your current company, you know the culture, the politics, and your standing. At a new company, you are starting over. Some of that risk is worth taking for the right opportunity, but it should be priced into your decision — not ignored.
If you want to see how your raise changes your monthly cash flow, try our paycheck budget planner to map every dollar of your new take-home pay.
The Hidden Costs of Leaving
Forfeited equity is often the largest hidden cost. If you have $80,000 in unvested RSUs with two years remaining, leaving means walking away from that money. Some companies offer a signing bonus to offset this, but signing bonuses are one-time payments while equity compounds.
COBRA coverage fills the gap between losing your current health insurance and starting the new plan. At roughly $500 per week for family coverage, even a two-week gap costs $1,000. A month-long gap costs $2,000. If the new company has a waiting period before benefits start, the cost adds up fast.
Relocation costs can range from $5,000 for a local move to $30,000+ for a cross-country move with a family. Even if the new employer offers relocation assistance, it often does not cover everything — and it may come with a clawback clause if you leave within one to two years.
401k restart means you may lose employer matching contributions if your new plan has a vesting schedule. Some companies vest 401k matches immediately, others over three to six years. Check both vesting schedules before deciding.
When Leaving Is Worth It Despite the Costs
Switching costs are real, but they are also one-time. A new job with a meaningfully higher base salary, stronger equity, and better long-term growth potential can overcome short-term switching costs within one to three years. The multi-year projection in this calculator is designed to reveal exactly when — and whether — the new job pulls ahead.
Look at the cumulative comparison over three to five years. If the new job wins on cumulative net value even after absorbing all switching costs in Year 1, it is likely the better financial move. If the Stay option wins cumulatively through Year 5, the raise is probably the smarter choice — assuming career growth is comparable.
To compare two external offers instead of a stay-vs-leave scenario, use our job offer comparison calculator.
How to Use This Calculator
Step 1: Fill in the Stay side. Enter your current salary and the raise being offered — as a percentage or flat amount. The calculator shows your new salary after the raise. Add your current benefits, unvested equity, and commute costs.
Step 2: Fill in the Leave side. Enter the new company's offer details including base salary, signing bonus, benefits, and switching costs like relocation and benefits gap weeks.
Step 3: Set expected annual raises. Enter the annual raise you expect going forward at each company. This powers the multi-year projection and reveals whether the winner changes over time.
Step 4: Review the results. The calculator shows a Year 1 comparison, switching costs breakdown, and multi-year projection with 1, 3, and 5 year views. Toggle between them to see how the picture changes. Print the comparison to share with a partner or advisor.
Multi-Year Projection — Why It Matters
Year 1 comparisons are misleading when one-time items are involved. A $25,000 signing bonus makes the new job look great in Year 1, but it vanishes in Year 2. Switching costs like forfeited equity and COBRA also only hit Year 1. Meanwhile, compounding annual raises amplify small base salary differences over time.
The multi-year projection strips away these distortions. It applies your expected annual raise to each side, removes one-time items after Year 1, and shows both the annual and cumulative net value. A crossover point — where the losing option overtakes the winner — is a critical signal. If Stay wins Year 1 but Leave wins by Year 3, the short-term pain of switching may be worth the long-term gain.
If you want to see how your salary converts to an hourly rate for comparison purposes, use our salary vs. hourly calculator.
Frequently Asked Questions
Should I take a raise or a new job?
It depends on more than just salary. A raise keeps you in a known environment with no switching costs, while a new job may offer a higher ceiling but comes with forfeited equity, relocation expenses, and a benefits gap. Use this calculator to compare total compensation in both scenarios, including multi-year projections that show how compounding raises change the picture over time.
How much of a raise should I ask for to match an outside offer?
You need to account for more than the base salary difference. If the new job offers $120,000 and you make $100,000, a $20,000 raise might not be enough if the new job also has better equity, a signing bonus, or stronger benefits. Enter both scenarios in the calculator to find the true gap, then negotiate accordingly.
What are the hidden costs of switching jobs?
The biggest hidden costs are forfeited unvested equity, COBRA health insurance during the gap between jobs (roughly $500/week for family coverage), relocation expenses, loss of accumulated PTO, and restarting your 401k vesting clock. These one-time costs can easily total $10,000 to $50,000 or more, especially at companies with large equity packages.
How does unvested equity affect the stay vs. leave decision?
Unvested equity is money you have been promised but have not yet received. If you leave before it fully vests, you forfeit it entirely. A $200,000 equity grant with 2 years remaining means you are walking away from $200,000. The calculator factors this into the switching costs so you can see whether the new offer compensates for what you are giving up.
Why does the winner change over multiple years?
One-time items like signing bonuses and switching costs heavily influence Year 1 but disappear afterward. A new job with a $30,000 signing bonus might win Year 1, but if the Stay option has a higher base salary, compounding annual raises can close the gap and overtake the new job by Year 3 or 5. The multi-year projection reveals these crossover points.
Should I include a counter-offer in this calculator?
Yes. If your current employer makes a counter-offer, enter that raise amount on the Stay side. A counter-offer is effectively a raise, so the calculator will show you whether staying with the counter-offer or leaving for the new job is worth more. Keep in mind that counter-offers sometimes signal that you were underpaid to begin with.
How do I estimate COBRA costs?
COBRA lets you continue your employer health insurance after leaving, but you pay the full premium plus a 2% admin fee. For individuals, expect $600 to $800 per month. For families, expect $1,500 to $2,500 per month. The calculator estimates $500 per week as a reasonable middle ground. Enter the number of weeks you expect to be without coverage.
What factors should I consider beyond the numbers?
Career growth trajectory, management quality, company stability, work-life balance, commute, remote work flexibility, and cultural fit all matter. A calculator gives you the financial baseline, which removes emotional guessing from the money side of the decision. Once you know the financial difference, you can decide how much the qualitative factors are worth to you.