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Cost of Living Adjustment (COLA)


Helpful Information if You Are Not Yet Retired

When you retire, you will begin receiving a monthly pension benefit. Your benefits will be adjusted annually based on the average annual change in the Consumer Price Index (CPI) for the prior calendar year and the COLA limits in your plan. COLAs can increase or decrease depending on economic conditions, but your pension will never go below the basic benefit allowance you receive when you first retire.

Here are some additional things to keep in mind:

  • If there is a COLA for a given year, it will be applied to your base retirement amount, beginning with the April benefit payments.
  • If your first day of retirement is April 1 or before, you will get any applicable COLA for that year.
  • If your first day of retirement is April 2 or after, you’ll have to wait for next year’s COLA. 

Keep this in mind when planning your retirement date! 

Paying for the COLA

During your employment, contributory members pay a “COLA share” which helps fund future cost of living adjustments (COLA) to your retirement benefits. If you are a Plan 7 member this cost is included in your base contribution rate.

General information

Helpful Information if You Are Retired

The cost of living adjustment (COLA) is limited to a maximum annual increase or decrease set by the Board of Retirement and your plan limits.

The COLA is effective April 1, and any adjustments will appear on your April benefit made at the end of the month.

If the change in the CPI is negative due to deflation, your retirement benefit will be decreased, but it will never be decreased below the original benefit amount granted at retirement.

How the COLA Amount is Determined

SamCERA’s COLAs are calculated according to California law, which requires them to be based on the change in the annual Consumer Price Index (CPI) for the San Francisco-Oakland-San Jose area (as determined by the Federal Bureau of Labor Statistics). The law also requires the amount to be rounded to the nearest one-half of one percent.  Depending on how much the COLA is, your plan could limit the COLA. The COLA limits are:

  • 2% for Plans 4, 5, 6, and 7
  • 3% for Plan 2 and Probation Plan 1
  • 5% for General and Safety Plan 1

Plan 3 does not provide a COLA.

How to Find the Amount of Your COLA

To find the actual dollar amount of your monthly COLA amount, review your benefit statement, check stub, or login to MySamCERA