Based on Consumer Price Index, some retirees will see a 0.50% increase
By Michael Pramik, Ohio Public Employees Retirement System
Sept. 4, 2020 – OPERS has announced the cost-of-living adjustments that will be available for retirees in 2021.
Those whose retirement effective date is prior to Jan. 7, 2013, will continue to receive a 3 percent adjustment.
Retirees whose effective date of retirement is on or after Jan. 7, 2013, are scheduled to have next year’s COLA based on the CPI-W, the government’s inflation index for urban wage earners and clerical workers. According to state law, the annual COLA for these retirees is to be based on the change in the CPI-W index from the end of June 2019 to the end of June this year.
The U.S. Bureau of Labor Statistics reports that the CPI-W index increased 0.50 percent over that period. (For reference, click on “CPI-W, June 2020” on this page of the Bureau of Labor Statistics website and refer to cell AD-7 in the spreadsheet.) Thus, the COLA issued in 2021 to retirees with an effective retirement date on or after Jan. 7, 2013, will be 0.50 percent.
OPERS’ inflation-based COLA uses the same index as Social Security. But the time period measured is different, so the adjustments might not always match up.