Updated October 30, 2026. Quick answer: Utah Retirement Systems pays an automatic COLA, beginning once the allowance has been paid for at least one year, equal to the annual increase in the Consumer Price Index, capped at 4% for most systems, including Noncontributory, and 2.5% for Tier 2 systems and some public safety. Any CPI increase above the cap is accumulated and used in later years when the annual CPI increase is below the cap. URS calculates the COLA each January and pays it on the anniversary of the retirement date. The newest row on the URS COLA page, labelled 2025, is 2.6%. No 2027 COLA is set.
More on public pension retirement ages and eligibility: the Utah URS Tier 2 retirement age and eligibility rules.
Estimate a Utah Retirement Systems Tier 1 Noncontributory pension from service, age and average pay: Utah URS Tier 1 retirement calculator.
How the URS COLA works
URS says: “Depending on the system from which you retired, your COLA is capped at 4% (for most systems, including Noncontributory) or 2.5% (Tier 2 systems and some public safety).” “The URS COLA is calculated each January based on the previous year’s Consumer Price Index (CPI) as determined by the U.S. Bureau of Labor Statistics.” “COLAs are paid on the anniversary of your retirement date.”
What the statutes say
For Tier 1 Contributory, Utah Code 49-12-407 reads: “The original allowance shall be increased by the annual increase in the Consumer Price Index up to a maximum of 4%.” “Annual increases in the Consumer Price Index in excess of 4% shall be accumulated and used in subsequent adjustments when the annual increase in the Consumer Price Index is less than 4%.” “The cost-of-living adjustment made under this section may not decrease the allowance.”
For Tier 2, section 49-22-308 reads: “The original allowance shall be increased by the annual increase in the Consumer Price Index up to a maximum of 2.5%.”
Recent COLA rows
The URS COLA page lists these figures, before the 4% or 2.5% cap is applied for each system:
| Year as labelled by URS | CPI-based COLA |
|---|---|
| 2025 | 2.6% |
| 2024 | 2.9% |
| 2023 | 4.1% |
| 2022 | 8% |
| 2021 | 4.7% |
| 2020 | 1.2% |
Where 2027 stands
No 2027 URS COLA is set: URS calculates it each January from the previous year’s CPI, so it cannot exist before January 2027, and this page updates when URS posts it. The URS page is undated, so this page reports the newest row as printed.
A worked example
As a computed illustration (not a source figure), a retiree with a monthly benefit of $2,000 (invented, for the computation) whose COLA is 2.6% would see an increase of $52 (computed) a month.
Common mistakes
- Applying the 4% cap to a Tier 2 retiree. URS says Tier 2 systems and some public safety systems are capped at 2.5%.
- Expecting the COLA to reduce the allowance in a low-inflation year. The statute says it may not decrease the allowance.
- Counting on the uncapped CPI figure. The cap applies, and any excess is carried to later years in which the CPI increase is below the cap.
Related: Utah URS retirement decisions, how public pension decisions work, and whether Utah taxes pensions.
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Answer againSources
- Utah Retirement Systems, URS Cost-of-Living Adjustment (COLA) page: www.urs.org
- Utah Legislature, Utah Code 49-12-407 Annual cost-of-living adjustment (Tier 1 Contributory): le.utah.gov
- Utah Legislature, Utah Code Chapter 22 (Tier II) incl. 49-22-308: le.utah.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.