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4.9% COLA and 2.7% pay raise: What’s not to like?

With a 4.9% cost of living adjustment (COLA) set for Federal Employees Retirement System (FERS) retirees, and a 2.7% pay raise on track for January, many working feds and retirees have got to be breathing a sigh of relief. This is a real take-it-to-the-bank silver lining during a time of worldwide pandemic when so much has changed. It will make trips to the store and gas station less painful.

The problem, as always, for working folks and retirees is what’s next?

The COLA is the largest since the 5.8% they got in 2009 as the nation emerged from the Great Recession. That’s good news given the obvious increase in prices for most things. Including all important oil and gas. But that period was followed by a decade of low inflation and political pressures that kept COLAs on the low side. And while that full COLA will go into effect for Civil Service Retirement System (CSRS), military and Social Security retirees, the increase for those retired under the FERS program will be a percentage lower. A major factor as more current workers retire under the diet-COLA plan. Especially if the nation experiences high inflation for an extended period of time. Which is one of the reasons this is heads up time!

The period between now and the first of the year is always important for both retirees and working feds. December and January are when the most feds retire, for a variety of reasons. If your contemplating retirement (now or in the future) picking the “best” date is a major financial decision. It can lower your first year taxes, boost the amount of annual leave you can be paid for and increase the value of that leave by tens of thousands of dollars.

What a difference a day can make!

There are also lots of things to consider, including picking the best health plan for you and yours to get you through 2022. So I called in the cavalry in the form of Tammy Flanagan. She’s a well-known, popular federal benefits expert. And she is our a guest on our Your Turn. Tammy was a fed for many years and now does consulting with feds and retirees.

When I asked he what we should talk about today she suggested the following:

  • How does the COLA impact CSRS and FERS retirees in real world terms?
  • What does the COLA mean to Social Security numbers?
  • What should everyone do during the November-December health insurance hunting season
  • What many people forget when they purchase health insurance that could ruin them financially.
  • Last minute tips for those planning to leave at the end of this year or early in January.

The show starts at 10 a.m., streaming here or on the radio at 1500 AM in the Washington D.C.-Baltimore area. It will also be archived on our home page so you can listen later.

If you have questions for Tammy shoot them to me at

Nearly Useless Factoid

By Alazar Moges

An ordinance listing safety and environmental concerns in Hollywood, California bans the use of silly string on Halloween.

Source: NBC Los Angeles 

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