COLA (Cost of Living Adjustment)

A Cost of Living Adjustment (COLA) is an increase in your FERS annuity payment designed to offset inflation. The adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

For FERS retirees, COLA rules include:

• No COLA on FERS benefits until age 62, except for disability and survivor benefits
• If CPI-W increases less than 2%: Full COLA
• If CPI-W increases 2-3%: 2% COLA
• If CPI-W increases more than 3%: CPI-W minus 1%