Texarkandy
Thinks s/he gets paid by the post
- Joined
- Feb 12, 2008
- Messages
- 1,281
A sizable part of my ER income will be federal pension under the newer FERS plan. (the older CSRS system gets a better deal)
The pension is COLA'd to the CPI as follows:
CPI = less than 2%
COLA = CPI increase
CPI = between 2% & 3%
COLA = 2%
CPI = greater than 3%
COLA = CPI minus 1%
I understand there are others with pensions & annuities with COLA's tied to the CPI as well as various other indexes - I don't know all the details, but I also understand the CPI is not necessarily reflective of true inflation in col for the average person.
Since I am planning to semi-ER fairly early (around age 50) I am curious and would welcome the thoughts of forum members (some of whom are more financially astute than I) as to how my pensionmayl degrade over the long term (20, 30 years) under these CPI COLA rules.
The pension is COLA'd to the CPI as follows:
CPI = less than 2%
COLA = CPI increase
CPI = between 2% & 3%
COLA = 2%
CPI = greater than 3%
COLA = CPI minus 1%
I understand there are others with pensions & annuities with COLA's tied to the CPI as well as various other indexes - I don't know all the details, but I also understand the CPI is not necessarily reflective of true inflation in col for the average person.
Since I am planning to semi-ER fairly early (around age 50) I am curious and would welcome the thoughts of forum members (some of whom are more financially astute than I) as to how my pensionmayl degrade over the long term (20, 30 years) under these CPI COLA rules.