United States Office of Personnel Management 

The Federal Government’s Human Resources Agency 

Benefits Administration Letter 

Number: 22-102 Date: December 21, 2021 

Subject: Annual Changes

The Office of Personnel Management (OPM) annually updates Benefits 

Administration Letters (BAL) to reflect changes in variable interest rates and 

cost-of-living adjustments (COLA). The purpose of this BAL is to provide 

updated information on variable interest and COLA rates for 2022. 

Cost-of-Living Adjustments 

Individuals receiving a benefit from the Civil Service Retirement System 

(CSRS) and the Federal Employee Retirement System (FERS), with a few 

exceptions, will receive a COLA increase. The increase is effective 

December 1, 2021 and is payable to retirees in their January 2022 annuity 

payment. The maximum increase for CSRS is 5.9%. The maximum increase 

for FERS is 4.9%. 

Note: The minimum COLA increase payable under CSRS and FERS is $1.00. 

Even if the full COLA rate or prorated COLA would result in the annuity rate 

not increasing, a minimum of $1.00 is still added to the monthly annuity 

rate. Eligible annuitants who have been retired for at least one (1) year will 

receive the full COLA or the maximum increase provided by law. The COLA 

increase is prorated according to the annuity commencing date during an 

annuitant’s first year on the annuity roll. This provision applies to both CSRS 

and FERS retirement annuities. 
Benefits Administration Letter 22-102 

2 

FERS COLAs 

The December 1, 2021, FERS COLA is payable on annuities with 

commencing dates no later than November 30, 2021. COLA increases for 

FERS annuitants only apply to the retiree’s basic annuity (not the annuity 

supplement). The COLA applies to both the basic survivor annuity and 

supplementary annuity for survivor annuitants. 

Not all FERS annuitants will receive a FERS COLA. FERS COLAs generally do 

not apply to annuitants who are under age 62 as of December 1, 2021, 

except for: 

1. Spouse, former spouse, or insurable interest survivor annuitants;

2. Certain disability annuitants; 

3. Those who retired under the special provisions for law enforcement 

officers, firefighters, and Capitol Police; 

4. Those who retired under the special provisions for air traffic 

controllers; 

5. Those who retired under the special provision for military reserve 

technicians (age 50, 25 years of service) because they ceased to 

quality for military membership on account of disability; and 

6. Joint Payroll Office FERS Special annuitants 

Under FERS, COLAs do not increase the Social Security offset applied to a 

FERS disability annuity. Disability annuitants receiving the 60% rate during 

their first year on the disability roll will not receive a COLA increase. 

However, a COLA is payable during the first year if the annuity rate payable 

is the retiree’s earned benefit or the annuity is redetermined because the 

retiree has obtained age 62. 

CSRS COLAs 

CSRS COLAs apply to all annuities, regardless of the age of the annuitant. 

CSRS annuitants who have been retired for at least one (1) year will receive 

the full COLA or maximum increase. Annuitants will receive a prorated COLA 

during their first year on the annuity roll. The December 1, 2021, CSRS 
Benefits Administration Letter 22-102 

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COLA is payable on annuities with a commencing date no later than 

November 30, 2021. 

Prorated COLAs

Prorated COLAS are payable on annuities having a commencing date from 

December 1, 2020, through November 30, 2021. The proration is based on 

the number of months between the annuity commencing date and the 

effective date of the COLA. 

Annuitants will receive one-twelfth (1/12) of the full COLA rate for each 

month they receive an annuity. Survivors of deceased annuitants (other 

than children) receive a prorated COLA based on the date the annuity was 

first payable to the deceased annuitant. Survivors of deceased employees 

receive a prorated COLA based on the commencing date of the survivor 

annuity. Children of deceased annuitants will always receive the full COLA 

rate. The following table below shows the prorated percentage increase 

according to the month the annuity began. 

Prorated CSRS and FERS COLAs Effective 12/1/2021

Monthly Annuity Began Amount of Percentage 

Increase 

Retirement System CSRS FERS 

December 2020 or earlier 5.9% 4.9% 

January 2021 5.4% 4.5% 

February 2021 4.9% 4.1% 

March 2021 4.4% 3.7% 

April 2021 3.9% 3.3% 

May 2021 3.4% 2.9% 

June 2021 3.0% 2.5% 

July 2021 2.5% 2.0% 

August 2021 2.0% 1.6% 

September 2021 1.5% 1.2% 

October 2021 1.0% 0.8% 

November 2021 0.5% 0.4% 
Benefits Administration Letter 22-102 

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Increase in Children’s Benefits 

CSRS COLA rates apply to children’s survivor annuity benefits regardless of 

whether their parent received a benefit under CSRS or FERS. However, 

under FERS, children’s benefits are offset by benefits payable under Title II 

of the Social Security Act. In most cases, the Social Security benefit will 

often exceed the FERS benefit resulting in a non-payment of FERS benefit to 

the child. The following rates apply from December 1, 2021, through 

November 30, 2022 

When the child has a living parent, who was married to the deceased 

employee or retiree, the benefit payable to that child is lesser of: 

• $585.00 per month per child; or 

• $1,755 per month divided by the number of eligible children (if over 

3).

When the child has no living parent who was married to the deceased 

employee or retiree, the benefit payable to that child is the less of: 

• $702 per month per child; or 

• $2,106 per month divided by the number of eligible children (if over 

3). 

FERS Annuitants with a CSRS Component 

FERS annuitants with a CSRS component will have their CSRS component 

computed under CSRS provisions. The CSRS portion is subject to CSRS 

COLA provisions which allow for a COLA increase prior to an annuitant 

attaining age 62. Thus, the CSRS component of an annuity may increase 

without a corresponding increase to the FERS portion of the benefit. 

FERS Basic Employee Death Benefit 

The $15,000 portion of the FERS Basic Employee Death Benefit (BEDB)

payable to spouses or former spouses is adjusted by the CSRS COLA. The 

CSRS COLA, effective December 1, 2021, increases the BEDB for an 
Benefits Administration Letter 22-102 

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employee who dies on or after December 1, 2021 to half of his/her final 

annual pay (or average pay, if higher), plus $37, 055.54. Chapter 70 of the 

CSRS and FERS Handbook contains additional information on the BEDB. 

Under BEDB provisions, the surviving spouse or former spouse must elect 

whether to receive the BEDB in one payment or 36 monthly installments. 

The current factor used to determine the monthly installment is .0294259

for deaths occurring on or after October 1, 2021. OPM’s notice of this factor 

was published in 86 Fed. Reg. 52951 (Sept. 21 2021), which contains 

additional information on the present value conversion factors related to the 

BEDB. 

Interest Rate for Service Credit Payments, Refunds, and 

Voluntary Contributions 

The variable interest rate for CSRS and FERS will remain at 1.375% for 

2022. 

Salary Cap 

Employees subject to a salary cap will pay retirement deductions on the 

capped amount, which is used to compute an employee’s high-3 average 

pay. The salary information on the SF-50, Notification of Personnel Action, 

should reflect the capped amount and not the salary that would have been 

payable without the cap. 

Reminder Regarding Military Deposits and Waiver of 

Military Retired Pay 

Use the table below to compute military deposits for service performed 

during the years indicated. The military deposit rate remains 7% for CSRS 

and 3% for FERS in 2022. Chapter 23 of the CSRS and FERS Handbook has 

detailed information on Service Credit Payments for Post-56 Military Service 

Deposits. BAL 03-105 explains the alternative method for employees under 

the Uniformed Services Employment Reemployment Rights Act (USERRA). 
Benefits Administration Letter 22-102 

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Employees who want to pay deposits for military service performed during 

the years indicated in the table below should request that the military pay 

center provide year-by-year earnings so you can correctly compute the 

deposit amount owed. 

1999 2000 Other Years 

CSRS 7.25% 7.40% 7.00% 

FERS 3.25% 3.40% 3.00% 

As a reminder, all military deposits must be paid in full to the employing 

agency prior to the employee’s separation for retirement. 

Additionally, employees requesting to waive military retired pay should 

submit their request directly to the Defense Finance and Accounting Service 

at the following address 30 days before their planned retirement date to 

avoid delay in the finalization of their retirement. A copy of this request must 

be attached to the retirement application: 

Defense Finance and 

Accounting Service 

U.S. Military Retired Pay 

8899 E 56th Street 

Indianapolis, IN 46249-1200

Phone: 1-800-321-1080

Fax: 1-800-469-6559

Chapter 22 of the CSRS and FERS Handbook (Chapter 22, Section 22 A4.1-

2) contains pattern language and required information for waiver request 

submissions. 

Present Value Factors 

OPM provided notice on March 29, 2021, of adjusted present value factors 

applicable to retirees who elect to provide survivor annuity benefits to a 

spouse based on post-retirement marriage, and to retiring employees who 
Benefits Administration Letter 22-102 

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elect the alternative form of annuity or elect to credit certain service with 

Non-Appropriated Fund Instrumentalities (NAFI service). 

The revised present value factors went into effect on October 1, 2021, and 

were published in the Federal Register on March 29, 2021. See \86 Fed. 

Reg. 15398. 

CSRS present value factors can be found by visiting: 

https://www.govinfo.gov/content/pkg/FR-2021-03-29/pdf/2021-06326.pdf

FERS present value factors can be found by visiting: 

https://www.govinfo.gov/content/pkg/FR-2021-03-29/pdf/2021-06324.pdf 

OPM applies these present value factors to compute reductions to the 

following specific benefits: 

• CSRS and FERS retirees’ benefits when the retiree elects the 

Alternative Form of Annuity; 

• CSRS and FERS benefits with a CSRS component when the retirees 

elect to credit refunded service that ended before March 1, 1991, 

without paying the deposit owed for that service; 

• CSRS and FERS benefits when retirees marry after retirement and 

elect to provide survivor annuity benefits for a post-retirement spouse; 

• Retirees’ benefits when the retirees elect to credit NAFI service for 

retirement purposes under 5 U.S.C. §§ 8347(q) and 8461(n); and 

• Retirement benefits for individuals with certain types of retirement 

coverage errors who can receive credit for service by taking an 

actuarial reduction under the provisions of the Federal Erroneous 

Retirement Coverage Correction Act, Pub. L. No. 106-265, 114 Stat. 

752 (2000). 

• OPM uses discount factors to compute the reduction to annuity 

benefits when retirees elect to credit their NAFI service. 
Benefits Administration Letter 22-102 

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Significant Social Security Figures for 2022 

The Social Security Administration publishes a Fact Sheet that lists annual 

figures significant to retirement matters every year. The Social Security 

maximum taxable earnings for 2022 is $147,000. 

The dollar amounts, or bend points, used in the Social Security benefit 

formula for workers who become eligible for benefits in 2022, and in the 

formula for computing maximum individual benefits for 2022 are $1,024.00 

(first) and $6,172.00 (second). More information on the Social Security 

benefit bend points may be found by visiting 

https://www.ssa.gov/OACT/COLA/bendpoints.html

FERS Retiree Annuity Supplement Earnings Limit 

FERS annuitants receiving an annuity supplement are subject to an earnings 

test. The annuity supplement is reduced if the annuitant earns more than 

the exempt amount of earnings set forth each year by the Social Security 

Administration. The Social Security earnings limitation for 2022 is 

$19,560.00. If a FERS annuitant earns more than this amount, annuity 

supplement will be reduced by $1.00 for every $2.00 earned over the 

minimum level unless the annuitant retired under the minimum retirement 

age and retired under one of the special provisions related to these specific 

employee populations: 

• Law enforcement officers 

• Firefighters 

• Air traffic controllers 

• Military reserve technicians separated for loss of military membership 

Chapter 51, Section 51A3.1-1 of the CSRS and FES Handbook, contains 

more information on the reduction of a FERS annuity supplement due to the 

Social Security’s earnings limitation. 
Benefits Administration Letter 22-102 

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Thrift Savings Plan (TSP) Deferral Limit 

The Internal Revenue Service annual limit for elective deferrals increased to 

$20,500 for the 2022 tax year. “Elective deferrals” defined by TSP is the 

maximum amount employees can contribute to their account. The limit 

applies to the combined total of traditional and Roth contributions. Visit the 

TSP website for more information on TSP Contributions. 

In addition, TSP participants, age 50 and older, can make tax-deferred 

“catch-up” contributions from their basic pay to their TSP accounts. These 

contributions supplement the participant’s regular employee contributions 

and do not count against the Internal Revenue Code’s elective deferral limit. 

The catch-up contributions have a separate annual limit and eligibility 

criteria. This limit remains at $6,500 for 2022. More information on catchup contributions can be found by visiting 

https://www.tsp.gov/publications/tspfs12.pdf 

Sincerely, 

Margaret Pearson 

Associate Director 

Retirement Services