2% COLA? That’s Not a Raise — It’s a Warning Signal for Federal Retirees

June 18, 2025

On paper, a 2% COLA for 2026 might seem like good news.

Your pension is going up. The system is working. Right?

But that 2% increase might not actually protect your retirement the way you expect.

Why?

👉 Because many of the costs that hit federal retirees hardest—healthcare, housing, insurance premiums—are rising much faster than 2%.

And for those under FERS, there’s another quiet penalty:

When COLAs fall between 2% and 3%, FERS retirees don’t get the full adjustment. You’re capped at 2%.

It’s not about panic.

It’s about planning.

What the Wealthiest Retirees Do Differently

Federal retirees who stay ahead of inflation know this:

➡ Small COLAs can quietly erode purchasing power over time.

That’s why many shift a portion of their savings into assets that historically hold value when the dollar loses ground.

One of those assets?

Gold.

And here’s the key for Federal Workers:

You can roll over part of your TSP into a Gold IRA without penalties or taxes—if you do it the right way.

A 2% COLA isn’t terrible — but it doesn’t guarantee you a comfortable retirement.

It’s a reminder to look beyond what Washington provides.

And take the steps to protect the retirement you’ve worked for. A retirement of joy and peace, not sacrifice.

Best,
—Federal Wealth Retirement