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Mix sugar, salt, butter or margarine and milk in a saucepan. Place the mixture on the stove, and bring to a boil over medium heat. Stir carefully and continuously for exactly 5 minutes. If you stop stirring, the mixture will rise in the pan and burn. If the mixture is too near the top of the pot, the heat is too high and should be lowered.
Prepare gelatin according to package directions, using only 1 cup water. While gelatin is still liquid, add it and raspberry jam to fudge mixture. Boil for 3 minutes, stirring constantly.
Remove the saucepan from heat. Turn off the heat. Add chocolate chips immediately, and stir until they are all dissolved. Add vanilla extract and stir. Pour fudge into the prepared pan. Refrigerate overnight.
When fudge is hard, turn the pan over and run hot water over the bottom so you can remove the fudge easily.
Cut into 16 squares.
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