Every July 1, a retiree who has been retired at least 1 full fiscal year gets a simple COLA of 3% of the base retirement benefit. The Board may authorize a higher percentage or a compound COLA depending on investment returns and actuarial condition. Member Handbook p. 26, Will my monthly retirement benefit remain the same for the rest of my life?; p. 5; p. 52, Glossary, Cost of Living Adjustment; General Info pamphlet p. 2; 2026 Retirement Planner p. 3
Simple, not compound
Each July 1, the annuity = base annuity x (100% + 3% for each full year from the base date to that July 1). The base is the annuity on the later of July 1, 2001 or the retirement date; it was reset to the July 1, 2009 amount after the compounded 2009 COLA. The stipend is not part of the base. Actuarial valuation 2025 p. C-4, item 8 (A.C.A. §§ 24-7-713, 24-7-727); p. C-6, item 14
The actuary's projection
The member in the actuary's example takes Option A: $18,475 a year at retirement, then about $536 more each year.
| Year ended June 30 | Printed | Our engine |
|---|---|---|
| 2026 | $18,475 | $18,475 |
| 2027 | $19,011 | $19,011 |
| 2028 | $19,547 | $19,547 |
| 2029 | $20,083 | $20,084 |
| 2030 | $20,619 | $20,620 |
The actuary rounds the yearly raise to $536; 3% of the option amount is a few cents more, so our figures can differ by $1. Actuarial valuation 2025 p. C-11, Projected Benefits
Higher or lower COLAs
No source shows a change to the 3% simple COLA after 2009. 24 CAR § 10-610(c) lets the Board, by resolution, reverse a compound COLA (phased in as it decides) to maintain actuarial soundness. 24 CAR § 10-610(c); Member Handbook p. 26
The July 1, 2009 COLA was compounded and the base reset to the July 1, 2009 amount. Actuarial valuation 2025 p. C-4, item 8
In T-DROP
T-DROP participants get the 3% COLA each July 1 as if retired; deposits rise by 3% of the initial T-DROP deposit each year. T-DROP pamphlet p. 2, Do Members Receive a COLA in T-DROP?; 24 CAR § 10-704(b)(1); Actuarial valuation 2025 p. C-3, item 7 T-DROP explained →
From the sources
- Each July 1, after you've been retired a full fiscal year, you get a 3% cost-of-living increase. It's 'simple': 3% of your original base benefit each year, not compounded.Member Handbook pp. 5, 26, 52; Actuarial valuation 2025 p. C-4, item 8
- The ATRS Board may give a higher or compound COLA when finances allow (it compounded the July 2009 COLA) and may by resolution reverse a compound COLA to keep the system sound.Member Handbook p. 26; Actuarial valuation 2025 p. C-4; 24 CAR § 10-610(c)
- The $50 stipend isn't part of the base, so it doesn't grow with the COLA.Actuarial valuation 2025 pp. C-6, C-11
Questions
When do ATRS retirees get a COLA?
Retired at least one full fiscal year (July 1 - June 30); paid each July 1. It's 3% of your base benefit each year.
Is the ATRS COLA compounded?
No. It's simple: 3% of your original base benefit is added each year, so the raise is the same dollar amount every year. The Board can grant more when finances allow.
Does the $50 stipend get the COLA?
No. The stipend isn't part of the base benefit, so it stays at $50.
Source: ATRS Member Handbook, 2026-2027 school year (current as of July 2026), pp. 5, 26, 52. Also: General Info pamphlet p. 2; 2026 Retirement Planner p. 3; Actuarial valuation 2025 pp. C-3, C-4, C-6, C-11; T-DROP pamphlet p. 2; ATRS rules, 24 CAR §§ 10-610, 10-704. Last reviewed .