The inflation index used to determine the January 2022 federal retirement COLA increased by 0.9 percentage points in April, bringing the count toward that COLA to 3.1 percent with five months left in the measuring period.

The retiree COLA hasn’t exceeded 3 percent since 2012, when those retired under the CSRS system received 3.6 percent and those retired under the FERS system who were eligible for COLAs received 2.6 percent. When the inflation measure is 3 percent or above, FERS retirees who are eligible for COLAs receive 1 percentage point less.


The figure is subject to decreasing in upcoming months, although that has not been the trend during the seven months so far in the current count. Only one has been negative, a 0.1 percentage point decrease last November.

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.

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.

Read more on COLAs – Federal Cost of Living Adjustments at ask.FEDweek.com

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