How Does the Annual COLA Affect FERS Transferees?

View this article online at and visit to sign up for free news updates
By on October 31, 2018 in Q&A, Retirement with 0 Comments

Senior citizen man sitting at a desk looking at bills with a puzzled look on his face

The other day I had a question from a reader about how the 2019 retiree cost of living adjustment (COLA) would affect him, as he was a FERS Transferee. Most FERS transferees (those who transferred to FERS during one of the two open seasons, or after returning to federal service) have retired by now.

A FERS transferee would receive both a CSRS annuity (covering the years s/he worked under CSRS) and a FERS annuity (covering the years s/he worked under FERS); they would be combined into one monthly payment. 

Here’s an example of how the annuity would be calculated for a FERS transferee. An employee left federal service after spending 15 years under CSRS and, upon his return to federal service, elected to be covered under FERS. He retired after having worked an additional 18 years under FERS. This employee left with a high-three salary of $75,000.

Years of service Percentage factor Amount
15 years of CSRS 26.25% $19,687.50
18 years of FERS

18% at the 1% factor

19.8% at the 1.1% factor



Total pension

If FERS time = 1%

If FERS time = 1.1%



The CSRS part of the pension would receive CSRS cost-of-living adjustments, while the FERS part would receive FERS cost-of-living adjustments.

For 2019, that would mean that the CSRS part of the annuity would receive the full 2.8% COLA and the FERS portion might receive a 2% COLA (if the Consumer Price Index increase is between 2% and 3%, FERS COLAs are limited to 2%). The reason that I said the FERS portion of the annuity might receive a COLA is that, unless you are a special category employee, you must be age 62 or older to be eligible for the FERS COLA.

Survivor benefits would be based strictly on FERS rules. Rules for any deposit service, redeposit service and military deposits would be based on when the service took place.

Agencies can request to have John Grobe, or another of Federal Career Experts' qualified instructors, deliver a retirement or transition seminar to their employees. FCE instructors are not financial advisers and will not sell or recommend financial products to class participants. Agency Benefits Officers can contact John Grobe at [email protected] to discuss schedules and costs.

© 2020 John Grobe. All rights reserved. This article may not be reproduced without express written consent from John Grobe.


About the Author

John Grobe is President of Federal Career Experts, a consulting firm that specializes in federal retirement and career transition issues. He is also affiliated with TSP Safety Net. John retired from federal service after 25 years of progressively more responsible human resources positions. He is the author of Understanding the Federal Retirement Systems and Career Transition: A Guide for Federal Employees, both published by the Federal Management Institute. Federal Career Experts provides pre-retirement seminars for a wide variety of federal agencies.