Cost-of-living-adjustments (COLAs) are effective on December 1 of each year and are applied to the annuity payments made the following month. COLAs for those retired less than one year are prorated according to the date on which they retired. If you retire in January, your first adjustment will be made in January of the following year and will be for 11/12ths of the COLA amount. If you retire in February it will be 10/12ths, and so forth. Future COLAs will be for the full amount.
A federal retirement COLA will be paid in January 2025 of 2.5 percent for those retired under CSRS and 2 percent for those retired under FERS. The announcement follows completion of the count toward the adjustment with figures through September in the inflation index used to set the COLA.
COLA Based on Consumer Price Index
The COLA is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI/W) average of the third calendar quarter of one year to the next. If the inflation count finishes negative, benefits are frozen but not reduced. Also, in that situation the starting point for the next COLA count remains the same.
Note: Social Security COLAs follow the same formula except that a full Social Security COLA is paid even to someone who has drawn benefits for less than a year.
CSRS/CSRS Offset
Except for additional annuities purchased under the Voluntary Contributions Program, all annuities under CSRS are increased annually.
Recent COLA Amounts:
2025:
FERS: 2.0 | CSRS: 2.5
2024
FERS: 2.2 | CSRS: 3.2
2023
FERS: 7.7 | CSRS: 8.7
2022
FERS: 4.9 | CSRS: 5.9
2021
FERS: 1.3 | CSRS: 1.3
FERS COLAs
COLAs are paid to all FERS retirees, with the exception of regular retirees under age 62. COLAs are not payable on CSRS-based Voluntary Contributions annuities or the FERS Special Retirement Supplement.
COLAs are paid to:
- regular retirees age 62 or older;
- law enforcement officers, firefighters, and air traffic controllers;
- disability retirees after one year;
- military reserve technicians age 50 with 25 years of service if they lost their military status due to medical reasons; and
- special CIA employees.
COLAs on the FERS basic retirement benefit are based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI/W) average of the third calendar quarter of one year to the next. If the CPI/W increases by at least 3 percent in a given year, the COLA increase will be the CPI/W minus 1 percent. For example, if the CPI/W increases by 3.2 percent, the COLA would be 2.2 percent. If the CPI/W is between 2 and 3 percent, the COLA is 2 percent. If the CPI/W increases by 2 percent or less, then the COLA will equal the CPI/W.
COLAs on the Social Security portion of a total FERS benefit are fully indexed to the CPI/W and are paid each January. For FERS employees with CSRS service, the portion of the total annuity attributable to CSRS service also is fully indexed.