A cost-of-living adjustment (COLA) is an annual adjustment applied to your retirement income to reflect changes in the economy (inflation). Most DRS retirement plans offer a COLA, but Plan 1 members in PERS and TRS only have a COLA if they selected it during retirement. View the 2026 COLA percentages by retirement date and plan. When will I receive the 2026 COLA? LEOFF Plan 1 COLAs take effect April 1 and start with April 30 benefit payments. All other DRS Plan COLAs take effect July 1 and start with July 31 benefit payments. You need to be retired by July 1 for at least one year to be eligible for a COLA. Once you’re eligible, you’ll receive any COLA starting with the pension payment issued at the end of July, and every year after. You don’t need to apply to receive the COLA, it’s automatic. How much will the COLA be? The maximum annual COLA you can receive for most DRS plans is 3%. If inflation that year is above 3%, the additional amount is applied to future adjustments (called COLA banking). Any year inflation is lower than 3%, the COLA can pull from banked amounts in prior years. This happens automatically and the adjustment is made for you. You could receive a different adjustment each year, depending on the amount available in your COLA bank. View the 2026 COLA percentages. Will PERS 1 and TRS 1 receive a benefit increase?  If the legislature changes the current law, most of these retirees could receive a one-time increase in July. There are several bills that could affect this decision. You can track all bills here. 

It can be difficult to determine the steps to get ready for retirement. This simple timeline highlights key steps to help you stay on track. Some retirement plans like LEOFF and WSPRS allow for a full retirement benefit at age 53 or 55. PSERS uses age 60. Others, like PERS, TRS, and SERS, use age 65 as the normal retirement age. At age 60, or five years out: Attend a Nearing Retirement Seminar online. Learn when and how to request an estimate, restore or purchase service credit, and explore ways to increase your income with annuity options. Explore your annuity options. An annuity provides guaranteed monthly income in addition to your pension, and it has a cost-of-living adjustment (COLA). Plan 3 members have an additional option to consider called a TAP annuity. Plan for health care. Explore your options and decide when to apply for Medicare and Social Security. Your employer may have helpful guidance. You can also contact:PEBB – If you have PEBB or SEBB healthcare, you can enroll in PEBB retiree healthcare when you retire. Contact the Health Care Authority to learn more.VEBA – Voluntary Employees Beneficiary Association. They provide a Health Reimbursement Arrangement (HRA) which is an account you can use to reimburse your out-of-pocket health care expenses. Check with your employer to find out if they offer VEBA. SHIBA – Statewide Health Insurance Benefits Advisors. Trained volunteers who can answer your Medicare questions. At age 50, or 15 years out: Consider increasing your DCP contribution. Once you turn 50, you can contribute a higher annual limit to DCP. You can also contribute up to twice the maximum during the three years before retirement.  Use the Benefit estimator in your online account. By answering a few simple questions, this tool will allow you to see what your monthly income might look like. Log in to your online account and select Benefit Estimator to get started. Any time before age 50: Review your service credit. Check your service credit total in your online account, especially if you have taken time off for illness, injury, military duty or a sabbatical. You may be able to restore missed credit, but deadlines and costs vary. Sign up for Washington’s DCP. If you already have an account, increase your contribution. Your pension is designed to replace about 50% of your income, so additional savings can make a big difference. You can choose your own investments or have them professionally managed. Update your beneficiaries. Life moves quickly and changes such as marriage, divorce or growing your family can affect who you want to name as your beneficiaries. Make sure your account reflects your current wishes.

Taxes are known causes of headache, nausea and anxiety. But when you save with the Deferred Compensation Program (DCP) there are actual tax benefits that can cure your taxation woes. Well, at least a few of them! Here’s how taxes affect your DCP savings: DCP has a Roth and a pretax option. Each option affects when your retirement contributions will be taxed. Use this handy calculator to see which option is best for you. What is Roth? Your contributions are made after your income is taxed. When you take a withdrawal, the earnings associated with your Roth contributions will not be taxed if you meet the minimum qualifications. These qualifications include a five-year holding period from the year of your first contribution, and a minimum age of 59½. If you withdraw before meeting these qualifications, your earnings will be taxed. What is pretax? Your contributions are made before they are taxed. Withdrawals, including investment earnings, are taxed in the year you withdraw them. Every pretax dollar you contribute reduces your taxable income by a dollar. As a result, you’ll pay less in your current income taxes for the year because, in the eyes of the IRS, you’ve been paid less money. This can help reduce the impact on your overall take-home pay. You’ll pay taxes on the contributions and earnings in the year the money is distributed, which could mean a lower tax bracket during your working years. Contributions to DCP will not impact your pension or Social Security benefits. That’s because only federal income tax is deferred, not pension contributions or Social Security tax. The DCP – Deferred Compensation Program webpage has more tips and information about how saving with DCP has many advantages in addition to tax savings. If your employer doesn’t offer DCP, find out what retirement savings options you do have. Or think about opening a traditional pretax or Roth IRA through a financial institution. Overall tax considerations DRS and the investment record keeper Voya are not able to offer tax advice. Please work with a tax advisor if you have questions beyond the general information we can provide. Okay, disclaimer aside, here’s what we can tell you about your pension plan: For most people, whether you are in Plan 1, 2 or 3, your retirement contributions are deducted from your salary before taxes. This means these amounts have not been taxed (same as the pretax option available for DCP). Plan 3 doesn’t have a Roth option because current IRS laws don’t allow it. When you withdraw these funds, either as a withdrawal or in retirement, you will pay federal income tax on the money you receive. When we issue payment, DRS withholds IRS federal income tax for your distribution type. No matter what state you live in, we do not withhold state income tax. You will be responsible for determining any additional taxes owed when you receive a withdrawal or monthly pension payment. Tax tips The biggest tool you have is planning. Make sure your withholding information is accurate. Even if you don’t file your taxes until April each year, calculate them in January or February every year so you’ll know in advance whether you’ll owe. Did you get a refund this year? If you did, you overpaid your taxes and gave the government an interest-free loan. Think about the best way to use this year’s tax refund before you spend it on something you may want but don’t need. Use the refund to help build up your emergency savings, pay down debt, or get closer to achieving a personal savings goal. To help keep more of your money working for you throughout 2025 and beyond, consider increasing your contributions to DCP. Did you owe money this year? You can help change that next year by reducing your taxable income. Saving to DCP on a pretax basis can help you do that as well. With pretax saving, you’ll reduce your current taxable income and may also save money on the taxes you will eventually pay. It’s never too late to save for retirement or update your tax situation. Make this the year you take what you’ve learned to help improve your financial situation now and in the future.

During the 2026 session, DRS tracked bills that affected retirement, including pensions and benefits. Here are bills tracked, including summary descriptions from legislative reports: [table id=426 /] Bills marked with an asterisk (*) have passed, and bills with two asterisks (**) have been passed into law.