Two federal retirees with the same size pension can get different raises in the same year, purely based on which retirement system they're under. For 2026, CSRS retirees get a 2.8% cost-of-living adjustment — the same rate as Social Security. FERS retirees get only 2.0%. * The gap isn't a mistake; it's built into how FERS was designed. FERS retirees also receive Social Security benefits from their federal employment, on top of their FERS annuity, while CSRS — the older system, mostly covering people hired before 1987 — doesn't include Social Security at all. Because FERS retirees get COLA protection through two separate income sources, Congress deliberately made the FERS annuity COLA smaller. * The actual formula for FERS is a step-down rule: if the underlying COLA (matching Social Security's rate) is 2% or less, FERS retirees get the full amount. If it lands between 2% and 3% — as it did for 2026 at 2.8% — FERS retirees are capped at 2%. If it goes above 3%, FERS retirees get 1 percentage point less than the full COLA. * Both COLAs are calculated the same way and take effect the same date — officially December 1, showing up in the payment issued the first business day of January, which covers December's benefit. One more restriction specific to FERS: most FERS retirees don't receive any COLA at all until they turn 62, regardless of when they actually retired, with exceptions for disability retirees, survivor benefits, and certain special-provision employees like law enforcement and firefighters.