How to Calculate Percentage Increase and Decrease for Prices, Salaries, and Investments

Percentage change is the number you see everywhere — a 12% rent increase, a 5% raise, a 23% stock market drop, a “30% off” sale. Yet it is also one of the most frequently miscalculated figures, because people confuse percentage change with percentage of. The difference matters: a price rising from $50 to $60 is a 20% increase, not a 10% one. Here is how to do it right every time.

Use the Percentage Calculator to check any of these calculations instantly — but learn the formula below so you understand what the number means.

The Percentage Change Formula

The formula is the same for increases and decreases:

Percentage change = (New Value − Original Value) ÷ Original Value × 100

• If the result is positive, it’s a percentage increase.
• If the result is negative, it’s a percentage decrease.
• Always divide by the original value, not the new one — this is where most errors happen.

Real-World Examples

Price Increase

Your rent goes from $1,200 to $1,344.
Change = (1344 − 1200) ÷ 1200 × 100 = 144 ÷ 1200 × 100 = 12% increase.

Salary Raise

Your salary goes from $50,000 to $52,500.
Change = (52500 − 50000) ÷ 50000 × 100 = 5% raise.

Investment Loss

A stock falls from $80 to $61.60.
Change = (61.60 − 80) ÷ 80 × 100 = −18.40 ÷ 80 × 100 = −23% (a 23% decrease).

Sale Discount

A jacket drops from $40 to $28.
Change = (28 − 40) ÷ 40 × 100 = −30% (a 30% discount).

The Trap: Why a 50% Loss Needs a 100% Gain to Recover

Percentage changes do not cancel out symmetrically. If an investment drops 50% (from $100 to $50), it needs a 100% gain to get back to $100 — because the 100% is now calculated on the smaller $50 base. This is why percentage change must always be anchored to the original value, and why financial advisors emphasize protecting against large losses.

Loss	Gain Needed to Recover
−10%	+11.1%
−20%	+25%
−30%	+42.9%
−50%	+100%
−80%	+400%

Common Mistakes to Avoid

• Dividing by the new value instead of the original — always use the starting number as the denominator.
• Confusing percentage points with percentage change — an interest rate rising from 4% to 5% is a 1 percentage point increase but a 25% relative increase.
• Adding/subtracting percentages directly — a 10% discount followed by another 10% discount is 19% off, not 20% (0.9 × 0.9 = 0.81).
• Ignoring the sign — a negative result means decrease; don’t report it as an increase.

Quick Mental Checks

• 10% of any number = move the decimal one place left ($200 → $20).
• 5% = half of 10%.
• 1% = move the decimal two places left.
• For doubling, the increase is always 100% (2× original).

Whether you are negotiating a raise, checking a sale price, or tracking your portfolio, the formula is always the same. Verify your math with the Percentage Calculator — it handles increases, decreases, and percentage-of problems in seconds.