Some Plan E members with service credit earned prior to June 4, 2002, can make a greater portion of their retirement allowance eligible for COLA adjustments through the purchase of Elective COLA.
Elective COLA Eligibility
- Active Plan E member with service credit earned prior to June 4, 2002
- Vested Plan E member with service credit earned prior to June 4, 2002, who terminated, returned to County employment, and elected Plan E
The Elective COLA benefit is granted by the Board of Retirement based on the Consumer Price Index, in the same manner as the automatic COLA, with the same survivor and beneficiary benefit. It is also subject to the same 2.0 percent maximum allowable adjustment.
Purchasing Elective COLA
Contact us or log in to My LACERA if you would like to initiate an Elective COLA purchase. The cost to purchase COLA is based on the estimated cost of the future Elective COLA benefit. By law, Elective COLA must not place any additional burden on the retirement system; therefore, the member must pay the entire cost.
At the time of purchase, LACERA will project the cost of your Elective COLA based on:
- Your current compensation earnable
- Your current age
- Years of service (not including ARC purchases)
- Spouse or domestic partner's age (if applicable)
- Actuarial assumptions for:
- Increases to your compensation earnable
- Retirement at age 65
- Life expectancy for member and spouse or domestic partner
- Any years of service covered by Social Security
- Unmodified Retirement Option
A contract to purchase Elective COLA may be paid in a single lump-sum payment or through payroll deductions over a period ranging from two to 240 payroll periods (10 years) or through a combination of both.
At retirement, LACERA will use your actual retirement factors to recalculate the cost of your Elective COLA purchase. Any difference between the final calculation and the initial projection will determine whether you owe a balance to LACERA or LACERA owes you a partial refund.
Elective COLA may not benefit all members. Since the cost for Elective COLA is based, in part, on actuarial assumptions for life expectancy and annual inflation, if you don't reach the actuarially projected life expectancy or if inflation is lower than the assumption, you may not recover your total Elective COLA purchase cost.