Most railroad retirement annuities, like social security benefits, are scheduled to increase in January 2018 on the basis of the rise in the Consumer Price Index (CPI) from the third quarter of 2016 to the corresponding period of the current year.
Cost-of-living increases are calculated in both the tier I and tier II benefits included in a railroad retirement annuity. Tier I benefits, like social security benefits, will increase by 2.0 percent, which is the percentage of the CPI rise. Tier II benefits will go up by 0.7 percent, which is 32.5 percent of the CPI increase. Vested dual benefit payments and supplemental annuities also paid by the Railroad Retirement Board (RRB) are not adjusted for the CPI change.
In January 2018, the average regular railroad retirement employee annuity will increase $42 a month to $2,711 and the average of combined benefits for an employee and spouse will increase $60 a month to $3,937. For those aged widow(er)s eligible for an increase, the average annuity will increase $24 a month to $1,353. However, widow(er)s whose annuities are being paid under the Railroad Retirement and Survivors¹ Improvement Act of 2001 will not receive annual cost-of-living adjustments until their annuity amount is exceeded by the amount that would have been paid under prior law, counting all interim cost-of-living increases otherwise payable. Some 50 percent of the widow(er)s on the RRB¹s rolls are being paid under the 2001 law.
Click here to read the release from the RRB.
