Updated September 3, 2026. Quick answer: Virginia Retirement System (VRS): the COLA is automatic (VRS reviews it every year by statute), service credit can be purchased, and no DROP was found. Vesting takes five years (60 months) of service credit.
Provisional. This page is published at medium confidence. The specific points that could not be confirmed are listed under What could not be verified below, and are named rather than smoothed over.
The verdicts
| Is the COLA granted? | Automatic (statutory annual review) |
|---|---|
| Is the COLA compounded? | Not stated |
| Vesting | 5 years (60 months) of service credit |
| Buy service credit? | Yes |
| DROP? | None found |
| State | Virginia |
Those first two rows are separate questions and are routinely confused. Whether you get an increase at all is one thing; whether it compounds is another. A system can grant an increase automatically every year and still compute it against your original benefit forever, which is a materially worse deal than it sounds.
The COLA
Virginia’s COLA is calculated automatically each year from the Consumer Price Index for All Urban Consumers (CPI-U), rather than granted at legislative discretion. Plan 2 and Hybrid: “The COLA is calculated using the first 2% increase in the CPI-U and half of any additional increase (up to 2%), for a maximum COLA of 3%.” Plan 1 uses a different calculation whose exact formula was not found in the materials reviewed for this system; VRS’s own COLA page confirms only that “The Code of Virginia caps the annual COLA at a 3% maximum for Plan 2 and Hybrid Retirement Plan members, or a 5% maximum for Plan 1 members.” Whether the adjustment compounds on the prior balance is not stated in the materials reviewed.
Buying service credit
VRS purchasable service includes refunded VRS service (unlimited), free military leave, sick and disability credit conversion at retirement, and a combined 48-month cap on educational/FMLA leave, federal civilian service, parental leave and other public service. Refunded-service cost: “based on the refund amount, plus interest compounded annually from the date of the refund to the date you buy back the service.” Most other purchases follow a cost window: “you have a two-year window of time to purchase most types of service at approximate normal cost before the cost changes to an actuarial equivalent cost.”
Run your own numbers before deciding: some purchases never recover their cost, and the calculator shows which.
Coordinate this with your overall retirement plan
An adviser can help weigh a COLA that may not compound, a service-credit purchase that may never pay for itself, or a DROP election against the rest of your retirement plan, but that does not replace the numbers in your own member statement.
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Vesting
“You become vested in the defined benefit component of your plan when you have at least five years (60 months) of service credit.” Applies to Plan 1, Plan 2 and the defined-benefit half of the Hybrid Plan; the Hybrid’s defined-contribution half instead vests on a graded schedule for employer contributions: 0% after one year of service credit, 50% after two years, 75% after three years, and 100% after four or more years.
DROP
No DROP program appears in VRS’s own materials. DROP programs exist at Fairfax County’s and Norfolk’s separate local retirement systems, but those are not VRS and not sourced from varetire.org: they are named here only to avoid the reader confusing a county-level program with the statewide system.
DROP is rarer than it appears across the systems on this site: most have none.
What could not be verified
REFUND TERMS: this page does not state what happens to your contributions if you take a refund instead of leaving your account with the system: that comparison was not independently researched for this system this session, and is left as an open gap rather than guessed from another system’s rule. Consult your own plan’s refund/forfeiture terms before deciding. Any additional field marked “not stated” in the verdicts table above was genuinely absent from the official materials read, not omitted for space.
Sources
Read September 3, 2026.
Related public pension systems: Massachusetts MTRS · Minnesota PERA.
General information drawn from each system’s own official published materials, not legal, tax or financial advice. Vesting, COLA and buyback rules are set by state statute and plan tier, differ materially by hire date, and can change by future legislation. This page cannot see your own member statement, which governs. We are not a law firm, a tax adviser, or a fiduciary, and this is not personalized advice.