University of California Retirement Plan (UCRP) and UC-PERS Plus 5 Plan benefit recipients, including those receiving survivor and UCRP disability income, will receive a cost-of-living adjustment (COLA) effective July 1, 2025. The increase will appear in checks paid on August 1.
Effective July 1, 2025, the COLA rate is 2.00% for those with a retirement date on or before July 1, 2024.
The COLA for UC-PERS Plus 5 benefit recipients is also 2% (same as that for UCRP benefit recipients with a retirement date of October 1, 1991).
UCRP benefit recipients are eligible to receive a COLA if they have been retired one full year by July 1. Therefore, those members whose retirement or disability date is after July 1, 2024, are not yet eligible to receive a COLA.
How the COLA is calculated
The 2025 COLA is based on the 2.89% average increase in the Consumer Price Index (CPI) for the Los Angeles and San Francisco metropolitan areas from February 2024 to February 2025.
The UCRP COLA formula generally matches the annual increase in the CPI up to 2%, plus 75% of the CPI increase in excess of 4%, to a maximum COLA of 6%. This year, all benefit recipients will receive a COLA that is less than the 2.89% increase in the CPI. Therefore, retained purchasing power for all UCRP benefit recipients will decrease from last year.
Adjustment to HAPC for inactive UCRP members (“Inactive COLA”)
When inactive UCRP members retire or request a lump sum benefit payment, their benefit is calculated based on the Highest Average Plan Compensation (HAPC) as of their separation date. For inactive members who retire with 1976 Tier service credit or who were Safety or Tier Two Members, their HAPC is increased by the lesser of 2% or the actual increase in the CPI, compounded annually, from the separation date to the date the inactive UCRP member retires or requests a lump sum benefit payment.
Effective July 1, 2025, the inactive COLA is 2.00% for those with a separation date on or before June 27, 2025.
Understanding UCRP’s COLA and Inactive COLA
UCRP, UC’s pension plan has two types of cost of living adjustments. One is called the retirement COLA, and the other is referred to as the “inactive COLA.”
The retirement COLA is available regardless of your UCRP retirement tier. The inactive COLA only applies to members of the UCRP 1976 Tier, including Safety members.
To learn more, please refer to the Retirement Handbook or watch the video below, produced by the UC Office of the President Retirement Policy team.