Updated October 25, 2026. Quick answer: OPM now lists the 2027 cost-of-living adjustments for federal annuitants: 3.6 percent for CSRS retirees and 2.6 percent for FERS retirees, up from 2.8 percent and 2.0 percent for 2026. Each year’s rate comes from the statute’s formula applied to the third-quarter price index, and the FERS rate is one point below the price index change when that change is over 3 percent.
More on public pension systems, topic by topic: Montana PERS GABA.
Project a Thrift Savings Plan balance with the FERS agency match and the 2026 limits: TSP calculator.
The 2027 rates
| Retirement system | 2027 COLA | 2026 COLA |
|---|---|---|
| CSRS | 3.6% | 2.8% |
| FERS | 2.6% | 2.0% |
OPM’s cost-of-living FAQ, read on October 25, 2026, says “For the year 2027, annuitants who retired under CSRS will receive 3.6 percent increase and those who retired under FERS will receive a 2.6 percent increase.” OPM says most retirees become eligible for the COLA at age 62. It adds “Certain retirees, like disability, survivor, and other special provisions, have different COLA entitlement rules.” and “FERS annuitants under age 62 are not eligible for COLA increases unless certain conditions are met.”
The 2026 rates
| Retirement system | 2026 COLA |
|---|---|
| CSRS | 2.8% |
| FERS | 2.0% |
OPM says “For the year 2026, annuitants who retired under CSRS will receive 2.8 percent increase and those who retired under FERS will receive a 2.0 percent increase.” It adds “The rate varies each year.” and “If a COLA is payable, we make the change in December of each year. You’ll receive the adjusted payment in January, the following month.”
How the CSRS rate is set
The statute, 5 U.S.C. 8340, defines the measuring period: “the term “base quarter”, as used with respect to a year, means the calendar quarter ending on September 30, of such year”. The increase takes effect “December 1” and equals “the percent change in the price index for the base quarter of such year over the price index for the base quarter of the preceding year in which an adjustment under this subsection was made”. Because the base quarter ends September 30, the 2027 rate cannot be known before the price data for that quarter is out.
How the FERS rate is set
The FERS statute, 5 U.S.C. 8462, adds a cap: “If the percent change in the price index for the year does not exceed 3 percent, each annuity subject to adjustment under this subsection shall be increased by the lesser of” the percent change or 2 percent. If the change is over 3 percent, the statute increases the annuity by the percent change minus 1 percent. So the FERS rate follows the CSRS rate when the price index is up 2% or less, stays at 2% between 2% and 3%, and runs one point below it above 3%.
Checking the 2027 rates against the formulas
SSA announced a 3.6 percent cost-of-living adjustment for 2027 on October 14, 2026, based on the change in the CPI-W from the third quarter of 2025 through the third quarter of 2026. A change of 3.6 percent is over 3 percent, so the FERS statute gives 3.6 minus 1 = 2.6 percent, the FERS rate OPM lists; the CSRS rate is the 3.6 percent change itself. This check is computed here from the statute and SSA’s figure, and OPM’s own notice is the authority for the rates.
The rule in three illustrations
These rows are computed here by applying the statutes’ formulas to made-up inputs. They are illustrations, not the 2027 rates above.
| Price index change (illustration) | CSRS result | FERS result |
|---|---|---|
| 1.5% | 1.5% | 1.5% |
| 2.5% | 2.5% | 2.0% |
| 3.5% | 3.5% | 2.5% |
Common mistakes
- Assuming the CSRS and FERS COLAs match. FERS is capped when the price index change is above 2%.
- Treating a Social Security COLA projection as the federal retiree COLA. The statutes use their own measuring period and formula.
- Expecting the increase before January. The change is made in December and paid the next month.
Related: the FERS retirement calculator, financial advisors for federal employees, the 2027 Social Security COLA page, and the 2027 numbers hub.
Sources
- U.S. Office of Personnel Management, Cost of living adjustments (retirement FAQ): https://www.opm.gov/support/retirement/faq/cost-of-living-adjustments/
- 5 U.S.C. 8340, cost-of-living adjustments of annuities (U.S. Code text, Cornell Legal Information Institute): https://www.law.cornell.edu/uscode/text/5/8340
- 5 U.S.C. 8462, computation of cost-of-living adjustments (U.S. Code text, Cornell Legal Information Institute): https://www.law.cornell.edu/uscode/text/5/8462
- Social Security Administration, 2027 Cost-of-Living Adjustment (COLA) Fact Sheet: https://www.ssa.gov/news/en/cola/factsheets/2027.html
Sources: the primary documents linked above, read on October 1, 2026, and the OPM and SSA 2027 pages on October 25, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.