OPM 2025 COLA Increase Date: When will federal workers receive their increase with the COLA 2025
According to Marca, Federal workers can anticipate a 2% pay increase from President Joe Biden’s Democratic administration as part of the Cost of Living Adjustment (COLA) for 2025. This raises the question: when will federal workers actually see this change?
Biden’s Announcement and Pay Comparisons
President Biden revealed this plan in a letter to Congress, marking one of his final actions in office. While the average pay increase of 2% is welcome news, it falls short of some of his earlier goals.
Previously, Biden aimed to align civilian federal workers’ pay increases with those of military personnel. However, military pay is set to rise by 3.5% through 2025, indicating that the government has not fully achieved this objective.
Effective Date of the Pay Increase
Federal workers can expect the new pay rates to take effect on January 1, 2025. Biden will issue an executive order before the end of 2024, enabling the Office of Personnel Management to create localized pay tables reflecting these changes.
In his announcement, the President emphasized that the adjustment aims to “attract, recruit, and retain a skilled workforce with fair compensation in order to keep our government running.”
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Understanding the COLA for 2025
The Cost of Living Adjustment is calculated based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). This index helps assess the impact of rising inflation on everyday goods and services that typical Americans encounter.
The Social Security Administration (SSA) utilizes this data to determine the COLA for the upcoming year, which aims to counteract the effects of living costs and inflation. For 2025, the COLA is expected to be set at around 2.5%.
Example of the COLA Impact
For instance, if an individual usually receives $2,000 in Supplemental Security Income or Social Security, the 2.5% COLA would adjust this amount to $2,050, resulting in a $50 increase in their monthly benefit.
Timeline for COLA Release
The official COLA for 2025 will be announced in October 2024. The Senior Citizens League anticipates that the adjustment will be no higher than 3% but no lower than 2.5%.