Cost of Living Adjustment 2017 Calculator

Use this calculator to determine your Cost of Living Adjustment (COLA) for 2017 based on your current salary and the inflation rate. COLA is typically applied to government salaries and pensions to account for rising living expenses.

What is Cost of Living Adjustment?

Cost of Living Adjustment (COLA) is a percentage increase applied to salaries, pensions, and other fixed-income benefits to compensate for inflation. It's commonly used by government agencies to maintain purchasing power over time.

The adjustment is typically based on the Consumer Price Index (CPI) for urban wage earners and clerical workers (CPI-W). For 2017, the COLA was calculated using the CPI-W data from the Bureau of Labor Statistics.

Key Points

COLA is not the same as a raise. It's a mandatory adjustment based on inflation data. The actual percentage increase varies each year depending on the CPI-W.

How to Calculate COLA

The basic formula for calculating COLA is:

COLA Formula

COLA Amount = Current Salary × (COLA Percentage / 100)

New Salary = Current Salary + COLA Amount

The COLA percentage is determined by the change in the CPI-W from the previous year. For example, if the CPI-W increased by 2.5% from 2016 to 2017, the COLA percentage would be 2.5%.

For 2017, the official COLA percentage was 2.0% based on the CPI-W data.

Important Notes

COLA calculations can vary slightly depending on the specific CPI-W category used. The 2.0% figure is the average across all CPI-W categories.

Example Calculation

Let's say you have a current salary of $50,000 and the COLA percentage for 2017 is 2.0%. Here's how the calculation works:

Example Worked Out

COLA Amount = $50,000 × (2.0 / 100) = $1,000

New Salary = $50,000 + $1,000 = $51,000

Your new salary after COLA would be $51,000. This maintains your purchasing power by accounting for the 2% increase in the cost of living.

Historical COLA Data

Here's a table showing the COLA percentages for recent years based on CPI-W data:

Year	COLA Percentage	CPI-W Change
2016	0.7%	0.7%
2017	2.0%	2.0%
2018	2.1%	2.1%
2019	1.6%	1.6%
2020	1.3%	1.3%

This data shows how COLA percentages have varied over time, with 2017 being a year with above-average inflation adjustments.

FAQ

What is the difference between COLA and a salary increase?

COLA is a mandatory adjustment based on inflation data, while a salary increase is typically based on performance or company decisions. COLA is meant to maintain purchasing power, while salary increases may be tied to other factors.

How is the COLA percentage determined?

The COLA percentage is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The BLS calculates this index monthly, and the annual change is used for COLA.

Can COLA be negative?

Yes, if there is deflation (a decrease in prices), the COLA percentage could be negative. This would result in a decrease in the salary or benefit amount.

Who receives COLA?

COLA is most commonly applied to government employees, military personnel, and recipients of Social Security benefits. Private sector employees typically receive regular salary increases rather than COLA.

Is COLA taxable?

In most cases, COLA is not taxable as income. It's considered a cost-of-living adjustment rather than additional earnings. However, tax laws can vary, so it's best to consult with a tax professional.