By law, LACERA retirement and survivor allowances are subject to an annual cost-of-living adjustment (COLA), helping to protect your fixed income from inflation. The adjustment is driven by changes in the cost of living over the previous 12-month period as of December 31.
Current COLA
For the most recent COLA affecting your allowance, see your specific plan page:
Each year, the Board of Retirement is required to review the Bureau of Labor Statistics Consumer Price Index (CPI) for all urban consumers in the Los Angeles-Long Beach-Anaheim metro area to determine whether there has been an increase or decrease in the cost of living over the prior year. The CPI is based on the price for consumer goods and services, and the year-to-year difference is reflected as a percentage.
Maximum Allowable COLA
The maximum allowable COLA award is determined by the provisions of each LACERA retirement plan.
- General/Safety Plans A allow a maximum adjustment of 3 percent.
- General/Safety Plans B and C, and General Plans D, E*, and G allow a maximum of 2 percent.
*Plan E COLA increases only apply to service credit earned on and after June 4, 2002, and any purchased Plan E Elective COLA.
By law, LACERA applies the percentage of annual increase (or, very rarely, decrease) in the cost of living, rounded to the nearest one-half of one percent, to each total retirement and survivor allowance. The adjustment is effective annually on April 1 and begins with April allowances. Members who retired prior to April 1 and eligible survivors of members who died prior to April 1 are eligible for COLA.
COLA Accumulation
Any COLA percentage above the maximum allowable amount for each plan is added to the COLA Accumulation to supplement future COLA benefits or to offset any decreases. LACERA uses the COLA Accumulation to fund the maximum increase allowable under each plan annually. The longer you have been retired or receiving a survivor's allowance, the more COLA carryover you may have accumulated.
See the current COLA Accumulation chart.
If the CPI is unchanged from the prior year, retirees and survivors will still receive the maximum allowable COLA increase, provided there is sufficient COLA Accumulation to fund it.
Even if the CPI indicates a COLA decrease, in most cases LACERA would still apply the maximum allowable increase to the allowances because most retirees and survivors would have a COLA Accumulation large enough to both offset the COLA decrease and fund the maximum COLA increase. In such a case, LACERA would reduce the plan’s COLA Accumulation by the amount of the negative percentage and the maximum percentage increase for each plan. If there's not enough COLA Accumulation to fund the maximum allowable increase, LACERA will apply an increase equal to the amount of the COLA Accumulation.
Important: A decrease to your allowance could only occur if you did not have a COLA Accumulation large enough to offset the COLA decrease percentage. However, the law dictates that a cost-of-living decrease may not reduce your allowance to an amount less than you received on the effective date of the allowance. Only past COLA increases could ever be subject to a decrease; the amount of your beginning allowance is guaranteed for life.