2027 COLA Brings 3.6 Percent Increase for Social Security, Less for FERS Retirees

The cost-of-living adjustments for 2027 are in, and Social Security beneficiaries and federal retirees will see increased benefits in 2027 to help offset rising prices. 

The Social Security Administration (SSA) said that beneficiaries will receive a 3.6 percent cost-of-living adjustment (COLA) in 2027, up from an increase of 2.8 percent in 2026. That means an average increase of $75 a month. 

Meanwhile, federal retirees in the Civil Service Retirement System (CSRS) will receive a 3.6 percent increase to their annuities while retirees in the Federal Employees Retirement System (FERS) will receive a 2.6 percent boost.

The discrepancy stems from the way FERS benefits are calculated. If the CSRS increase is three percent or more like this year, FERS enrollees receive that adjustment minus one percent. If inflation is between two and three percent, the FERS adjustment is capped at two percent. And when inflation is two percent or less, FERS retirees receive the full adjustment.

When FERS was created, it was designed as part of a retirement system that also includes Social Security benefits and savings through the Thrift Savings Plan (TSP), in addition to the federal pension.

Calls to Equalize “Diet COLA”

The pending “Diet COLA” reignited calls from federal employee advocates and lawmakers for congressional action to equalize the annual increases.  

“FERS retirees will have their COLAs reduced by an entire percentage point, reducing the real value of their annuities,” said National Active and Retired Federal Employees Association (NARFE) National President William Shackelford. “Inflation impacts these FERS retirees the same way as all other retirees, yet they are forced to accept a diet COLA.”

Meanwhile the Equal COLA Act (H.R. 491) remains stuck in the House of Representatives as the legislation has seen little movement since being introduced in January 2025. The bill– which has 90 cosponsors– would equalize COLA payments. 

The news on COLA comes after the Trump administration proposed no raise for most civilian federal employees in 2027 with a 3.8 percent boost proposed for select law enforcement positions. Health insurance premiums meanwhile are due to rise an average of 10.9 percent.