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TVARS Board Approves 1.68% COLA & 6% CB Interest Credit for 2015

The TVARS board approved a 1.68 percent cost-of-living adjustment (COLA) for eligible retirees and beneficiaries for calendar year 2015. Retirees will see the increase in checks beginning Jan. 31, 2015. The COLA is calculated by comparing the percentage change in the average CPI-U for Nov - Oct compared to the previous Nov - Oct.

The board approved a 6 percent interest credit to be applied to employee Cash Balance (CB) amounts for calendar year 2015. The TVARS rules provide for the interest credit to be the change in the CPI-U plus 3 percent, with a minimum rate of 6 percent. The change in the CPI-U was 1.68 percent.  The CB interest credit is one of the ways employees build the value of their pensions while they are working.  That is why it is supposed to be higher than the CPI-U.

Comments

  1. Leonard J. Muzyn, Jr., CFADecember 8, 2014 at 6:35 PM

    Note that the 1.68% differs slightly from other federal cost of living adjustments. This is because we compare November through October time periods.

    ReplyDelete

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