COLA the Highest in Recent Years

The 5.8 percent COLA that most federal retirees and survivor beneficiaries will receive with their January 2009 payments will be the largest since the 8.7 percent in 1982, and well above the 3.3 percent increase that was paid in January of this year. The COLA was determined by a 12-month measuring period that ended with September inflation figures as measured by the consumer price index for urban wage earners. Those retired under CSRS will get the full adjustment, while those retired under FERS and who are eligible for COLAs—in most cases, not until age 62—will get 4.8 percent on their civil service benefits and 5.8 percent on their Social Security benefits. FERS employees who have a CSRS component to their annuities, typically those who transferred from CSRS to FERS during one of the open seasons for doing so, will get the full adjustment on their CSRS component and the reduced adjustment on the FERS component. COLAs are pro-rated for those who retired, or will retire, during this calendar year.