Cost of Living Adjustment (COLA)

A Cost-of-Living Adjustment (COLA) is an increase applied to monthly benefit payments to eligible retirees to help offset rising prices for basic needs like housing, energy, and food. At SERS, COLAs are determined annually by the Board of Trustees with input from the System’s actuary.

Board Approves Maximum 2.5% COLA for 2026

September 19, 2025

At its September meeting, the Retirement Board unanimously voted to approve a 2.5% cost-of-living adjustment (COLA) increase for eligible benefit recipients in 2026.

By statute, SERS’ COLA:

• Is based on the year-to-year change in the Consumer Price Index, June 2024 to June 2025, for Urban Wage Earners (CPI-W)
• Has a floor of 0%
• Has a cap of 2.5%

This year’s CPI-W was 2.6%. The Retirement Board approved the statutory maximum of 2.5%.

The 2026 COLA:

• Takes effect on the benefit anniversary of the recipient’s effective date of retirement
• Will not materially impair the System’s funded status, according to SERS’ actuary Cavanaugh Macdonald

Benefit recipients whose benefit effective date is on or after April 1, 2018, must wait until the fourth anniversary of their allowance or benefit before receiving a COLA.

By statute, SERS calculates the COLA using the year-to-year change in the Consumer Price Index for Urban Wage Earners (CPI-W), June to June.

The COLA:

• Has a floor of 0%
• Has a cap of 2.5%
• May be adjusted by the Retirement Board if SERS’ actuary Cavanaugh Macdonald determines it will not materially impair the System’s funded status

COLA Waiting Period

Benefit recipients whose benefit effective date is on or after April 1, 2018, must wait until the fourth anniversary of their allowance or benefit before receiving a COLA. Benefits that originate from the same member account will not have more than a four-year waiting period in total.