Retiree COLAs Set at 1.5%

APWU Web News Article 124-2013, Nov. 1, 2013

The Social Security Administration has announced a cost-of-living adjustment (COLA) of 1.5 percent for federal and postal retirees.

Retirees over the age of 62 who have been receiving benefits for a year more as of Dec. 31, 2013, will receive the full amount. The Office of Personnel Management (OPM) will pro-rate the percentage for those who have been receiving benefits for less than one year as of Dec. 31.

The increase will be reflected in the January 2014 annuity and will apply to retirees covered by both the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS).

Annuitants on FERS disability retirement will receive the COLA regardless of age, unless they are receiving 60 percent or more of their high-three salary.

Retirees have been eagerly awaiting the announcement, which was made approximately two weeks later than usual, on Oct. 30, because of the government shutdown.

Go Figure

Cost-of-living adjustments for federal and postal retirees are based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, known as the CPI-W, but the calculation method has been the subject of great controversy in recent months.

The APWU Retirees Department and other retirees’ organizations have been urging Congress to use the Consumer Price Index for the Elderly (CPI-E), which takes into account seniors’ higher spending on medical care and the higher inflation rates they encounter as a result. This would more accurately reflect the increased cost of living retirees face and would result in greater COLAs.

While the COLA for 2014 is safe, in Congressional debt negotiations, some legislatives have proposed reducing federal and postal retirement benefits by using the “chained CPI.”

“The chained CPI is an unrealistic way to calculate the living expenses seniors face,” said Retirees Department Director Judy Beard. “We must continue to make it known to our representatives and to President Obama that our COLAs are not negotiable. If anything, they should be increased by using the CPI-E formula.”

 

  • redwood

    retiring in may 2014 will I get this?

    • reply for redwood

      No, you will have to wait for the 2014 COLA, if there is one. It would be prorated for the March – December time, and you would see it in January 2015.