Updated October 30, 2026. Quick answer: Pennsylvania SERS has no automatic COLA: the legislature and Governor must enact one. The 2026 COLA, approved in the 2026-27 state budget, is the first for SERS retirees since 2002. Retirees who retired on or before July 1, 2001, after reaching their full retirement age or on a SERS disability retirement benefit, get an increase of 15% to 24.5% of their July 2026 gross pension, retroactive to July 1, 2026 and included in the September 30, 2026 payment. SERS lists no 2027 COLA.
More on public pension retirement ages and eligibility: the Pennsylvania SERS retirement age and eligibility rules.
The 2026 COLA
The SERS fact sheet says: “In Pennsylvania, COLAs are not automatically granted. By law, the legislature and Governor must enact legislation granting COLAs. This is the first COLA for SERS retirees since 2002.” “To qualify for this COLA, you must have retired on or before 7/1/2001, after reaching your full retirement age/date (Age 60 or 50), or after qualifying for a SERS disability retirement benefit.” “The increases, retroactive to 7/1/2026, range from 15%-24.5% of your July 2026 gross pension payment, with higher increases for those who have been retired longer”. “The monthly lifetime increase will be included in your Sept. 30, 2026, payment.”
SERS’s press release of July 28, 2026 says: “As part of the commonwealth’s fiscal year 2026-27 budget, a cost-of-living adjustment (COLA) for those who retired on or before July 1, 2001, was signed into law earlier this month.”
The rule behind it
COLAs for SERS retirees are supplements enacted by statute. The State Employees’ Retirement Code says: “No cost-of-living supplement enacted after the death of the member shall be payable to the beneficiary or survivor annuitant of such deceased former State employee, except when the effective date of the supplement shall predate the death of the member by virtue of retroactivity of the supplement.” The previous COLA is the 2002 supplement, which the section limits to an eligible benefit recipient: “Commencing with the first monthly annuity payment after July 1, 2002, any eligible benefit recipient shall be entitled to receive an additional monthly supplemental annuity from the system.” The section defines that term as a person receiving an annuity on July 1, 2002 whose most recent effective date of retirement is before July 2, 1990.
Where 2027 stands
No 2027 SERS COLA is listed in the SERS documents read, and any COLA would need new legislation, so this page updates if one is enacted.
A worked example
As computed illustrations (not source figures), on a July 2026 gross monthly pension of $2,000 (invented, for the computation) a 15% increase is $300 (computed) a month and a 24.5% increase is $490 (computed) a month.
What this page does not cover
This page covers the SERS defined benefit plan retirees who retired on or before July 1, 2001. Later retirees and the defined contribution plan are not covered, and the act number and signing date of the 2026 law are not stated in the documents read.
Common mistakes
- Expecting an automatic yearly COLA. SERS says the legislature and Governor must enact one.
- Assuming a retiree who retired after July 1, 2001 qualifies for the 2026 COLA.
- Assuming a beneficiary receives a COLA enacted after the member’s death. The statute says it is not payable to the beneficiary unless the supplement’s effective date predates the member’s death through retroactivity.
Related: Pennsylvania SERS retirement decisions, how public pension decisions work, and whether Pennsylvania taxes pensions.
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Answer againSources
- Pennsylvania State Employees’ Retirement System, 2026 Cost of Living Adjustment fact sheet: sers.pa.gov
- Pennsylvania State Employees’ Retirement System, SERS news release, July 28, 2026: sers.pa.gov
- Pennsylvania General Assembly, 71 Pa.C.S. section 5708, Supplemental annuities: www.legis.state.pa.us
- Pennsylvania General Assembly, 71 Pa.C.S. section 5708.6, Supplemental annuities commencing 2002: www.legis.state.pa.us
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.