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.
At its September 2025 meeting, the Retirement Board unanimously voted to approve a 2.5% cost-of-living adjustment for eligible benefit recipients in 2026.
By statute, SERS’ COLA is based on the year-to-year change in the Consumer Price Index for Urban Wage Earners (CPI-W), June to June, with a floor of 0% and a cap of 2.5%. The 2025 CPI-W was 2.6%, so 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 and will not materially impair the System’s funded status, according to SERS’ actuary Cavanaugh Macdonald.
SERS calculates the COLA using the year-to-year change in the CPI-W from June to June. The COLA has a floor of 0% and a cap of 2.5%, and may be adjusted by the Retirement Board if SERS’ actuary determines it would 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.
