Cost-of-Living Adjustment (COLA)

13 December 2021

Cost-of-Living Adjustment (COLA)

Your initial benefit is adjusted over time for movements of the consumer price index in the United States or for your country of residence. If your benefit is on the dollar track, it will be adjusted periodically in accordance with the movement of the United States consumer price index (CPI). If you have opted for the two-track system, your pension amount will be adjusted by the movement of the CPI of your country of residence. For more information about the two-track, click here.

What is a Cost of Living Adjustment Letter?

Cost of Living Adjustment (COLA) letters, also known as Quarterly Statements, are informational statements provided to beneficiaries in receipt of a UNJSPF periodic benefit. These statements provide the quarterly exchange and COLA percentage applied annually to your benefit entitlements. They also detail the established monthly payable amount per quarter and the After Service Insurance Deduction, and the Total Net Payment Amount.

FAQs

Is my benefit adjusted for cost-of-living increases?

Your initial benefit is adjusted over time for movements of the consumer price index in the United States. New periodic benefits qualify for the full amount of adjustment only if they were first awarded at least 12 months before the normal adjustment date of 1st April. In the case of a benefit awarded less than one year earlier, the adjustment is reduced proportionately. The first cost-of-living adjustment is reduced by 0.5 percentage point. However, no adjustments are made to a deferred retirement benefit while the beneficiary is under age 55.

How often will my benefit be adjusted?

Normally benefits are adjusted once a year, provided that the relevant consumer price index has moved by at least 2% since the date of the last adjustment. Such adjustments are normally undertaken in April of the following year. However, in high-inflation situation, i.e. where the consumer price index has moved by 10% or more since the date of the last adjustment, benefits are adjusted semi-annually–on 1st April and 1st October.

Will my benefit be adjusted for changes in the cost-of-living in my country of residence?

It depends: If your benefit is on the dollar track, your benefit will be adjusted periodically in accordance with the movement of the United States consumer price index (CPI). If you have opted for the Two-track system and hence submitted a proof of residence for a country outside the USA, your local track pension amount will be adjusted by the movement of the Consumer Price Index of your country of residence. Please see our page on the Two-track system or the Pension Adjustment System annexed to the Regulations and Rules of the UNJSPF for a more detailed explanation.

Will I be sure to have an adjustment each year?

Adjustments are only made if the consumer price index has moved by 2% or more since the prior adjustment. If this is not the case, the CPI movement will be carried over and applied the following year.

Will I be notified if there is a change in the amount of my benefit?

Yes, the Pension Fund will inform you whenever there is a change in the amount of your periodic benefit, such as cost-of-living adjustments, application of the Fund’s pension adjustment system, change of exchange rate, discontinuation of a child’s benefit. Please also note that should there be a change in your ASHI premium, which may affect your benefit, it is your former employing organization that will notify you and not the UNJSPF.