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 include in your base contribution rate.