Cost of Living Adjustments

Experience Account COLAs

There must be sufficient funds in the system’s Experience Account to pay a COLA. If the balance is such that LSPRS may grant a COLA, the legislature must approve the resolution requesting the COLA.

 

COLAs may be granted if:

• the retiree has been retired for at least one year, and
• the retiree is at least 60 years old.

If the above criteria is met, COLAs may, with legislative approval, be granted as follows:
• the lessor of 3% or the Consumer Price Index amount for the previous calendar year (and, in years for which the system does not earn the required actuarial rate of return, the lessor of 2% or the Consumer Price index amount for the previous calendar year)
• plus, if approved by the legislature, an additional 2% for retirees age 65 or older
• this percentage is applied only to the first $85,000 of the retiree’s annual benefit, adjusted each year, beginning July 1, 2007, by the Consumer Price Index

 

Automatic Guaranteed COLA

Upon application for retirement, you may elect to receive an actuarially reduced retirement benefit (on an average the reduction is between 25% – 35%) plus a 2½% guaranteed permanent COLA. This election is irrevocable. Estimates of a guaranteed COLA can be provided upon request. If chosen, the COLA will be given annually after retirement.

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