Retirement > SERS > Payroll
40. How is the COLA calculated?
- Your COLA will increase your annual pension by an amount that is a percentage of that pension. The formula that is used to calculate your COLA depends on your date of retirement. Each formula takes account of the percentage by which something called the “CPI-W” has increased over the twelve months preceding the COLA. The “CPI-W is the Social Security Administration’s Consumer Price Index for Urban Wage Earners and Clerical Workers.
- If you retired or retire on or after August 1, 2022, your COLA will equal the increase in the CPI-W in years in which the CPI-W is 2% or less. If the CPI-W is greater than 2%, your COLA will fall within a range, from a minimum of 2% to a maximum of 7.5%. Within that range, the COLA will be equal to: 60% of the increase in the CPI-W up to 6%, plus 75% of the increase over 6%.
- If you retired after October 1, 2011, but on or before July 1, 2022, your COLA will fall within a range, from a minimum of 2% to a maximum of 7.5%. Within that range, the COLA will be equal to: 60% of the increase of the CPI-W up to 6%, plus 75% of the increase over 6%.
- If you retired on or after July 1, 1999, but before October 2, 2011, your COLA will fall within a range, from a minimum of 2.5% to a maximum of 6%. Within that range, the COLA will be equal to: 60% of the increase of the CPI-W up to 6%, plus 75% of the increase over 6%.
- If you retired before July 1, 1999, please see your plan’s Summary Plan Description to see how your annual COLA is calculated.