Fiscal Year, Birthday Quarters, and COLA Dates Matter
Summary
CalPERS published an informational guide explaining how fiscal years, birthday quarters, and COLA dates impact retirement benefit calculations. The article details service credit accrual during fiscal periods (July 1-June 30), benefit multiplier increases every three months after birthdate, and how retirement date selection affects initial COLA eligibility timing for members.
What changed
The guide explains three timing factors affecting CalPERS retirement benefits. Service credit is earned in tenths of a year with thresholds of 1,720 hours, 215 days, or 10 months full time per fiscal year. Benefit multipliers increase every quarter year of age (e.g., from 1.1% at age 50 to 2.5% at age 63 for State Miscellaneous & Industrial 2% at 55 formula). COLA eligibility timing differs significantly based on retirement date, with December 31 retirement earning first COLA in May 2028 versus January 1 retirement delaying first COLA to May 2029.
CalPERS members can use this information to strategically time their retirement date to maximize benefits. The content applies to all California public employees covered by CalPERS retirement plans. No compliance obligations are created by this informational guide.
Archived snapshot
Apr 18, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
Three key dates can affect your CalPERS retirement benefits: the fiscal year, your birthday quarter, and the first year you’re eligible for a cost-of-living adjustment (COLA). Choosing the right date can help you maximize your benefits.
Fiscal Year Affects Service Credit
If you start working in July, it’s possible to earn one year of service credit by the end of April (10 months), as service credit is earned in tenths, not twelfths. A fiscal year is defined as July 1 through June 30.
To earn a full year of service credit during a fiscal year, you must work at least:
- 1,720 hours (hourly pay employees)
- 215 days (daily pay employees)
- 10 months full time (monthly pay employees) For details, log in to myCalPERS and refer to your Annual Member Statement.
Birthday Quarters: An Increase Every 3 Months
Your benefit factor increases with each quarter year of age, or every three months, based on your birthday.
For example, based on a classic State Miscellaneous & Industrial member’s 2% at 55 formula, you are eligible to retire at age 50 with a multiplier of 1.1%. That multiplier increases every three months after your birthdate; at age 63 it reaches the maximum of 2.5%. If you are under 63, a birthday quarter may help to increase your benefit payment.
The benefit factor is the retirement formula based on your membership date with each employer. View the benefit factor chart for your formula to see how the multiplier increases with each quarter year of age.
COLA: December 31 vs. January 1
If you retire on December 31, 2026, you would receive your first COLA May 1, 2028. If you retire instead on January 1, 2027, that single day’s difference can delay the first eligibility by up to one year and you wouldn’t receive your first COLA until May 1, 2029. Retirees receive an annual COLA in the May 1 warrant of each year.
We determine the COLA amount to be paid to retirees by first comparing the compounded rate of inflation to the compounded COLA percentage based on the employer contract. The actual COLA percentage you receive is the lower of the two compounded amounts. We then use your base allowance, which is the amount you received when you first retired and prior to any cost-of-living-adjustments.
Visit our Cost-of-Living webpage to learn more about how the COLA is calculated.
CalPERS Quick Tip: Choosing a Retirement Date
Watch our Quick Tip video for a few things to consider when choosing a retirement date. Still have questions? Send us a secure message through myCalPERS.
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