The 2025 COLA for federal retirees is an adjustment to the basic pay of federal retirees that is made each year to keep pace with inflation. The COLA is calculated based on the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from December of the previous year to December of the current year. The COLA is then applied to the retiree’s basic pay, which is the amount of pay that the retiree was receiving at the time of their retirement.
The COLA is an important benefit for federal retirees because it helps to ensure that their retirement income keeps pace with the cost of living. The COLA has been in place since 1969, and it has helped to protect the retirement income of millions of federal retirees.
