How do FERS benefits increase after retirement?
With certain exceptions, FERS retirees don’t receive a cost-of-living adjustment to their annuities until age 62. Not subject to this limitation are:

• retirement benefits payable to law enforcement officers, firefighters, air traffic controllers, or military reserve technicians who lost their military status due to medical reasons and who were age 50 with at least 25 years of service, and special CIA employees;
• survivor benefits; and
• disability retirement benefits.

For FERS retirees with a mixed CSRS/FERS annuity, the COLA on the CSRS portion is governed by CSRS policies and the COLA on the FERS portion is governed by FERS policies.
The percentage increases start with the average Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the third quarter of each year over the third-quarter average CPI-W index of the previous year. If the CPI-W increase is 2 percent or less, the adjustment will equal the CPI-W increase.

If the CPI-W increases by 2 percent to 3 percent, the adjustment will be 2 percent. If the increase is 3 percent or more, benefits eligible for COLAs are increased by the CPI-W minus one percentage point.
For those retired less than 12 months, COLAs payable are prorated depending on the month in which their retirement begins FERS retirees are on the annuity roll in the month following the month in which they retire. For example, a FERS employee who retires on any date in June would be on the annuity roll in July.