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New Military Retiree and VA Disability Pay Increase

2021 retiree VA disability pay increase

2021 Increases for Military Retiree and VA Disability Pay

As we continue to push through the COVID-19 pandemic, 2021 is often viewed for many as a fresh start for the nation. However, military retirees who receive some disability or other benefit from the Department of Veteran Affairs will have a very pleasant surprise greeting them in the upcoming year. They will see a 1.3% increase in their monthly checks starting in 2021.

RELATED: VA Disability Pay Charts

The pay increase comes from the Cost of Living Allowance (COLA), which is usually increased every year based on the rate of inflation, along with military retirement pay, Survivor Benefit Plan Annuities, VA Compensation, and Pensions, and finally, Social Security benefits. The increase for 2021 is slightly less than the 1.6% increase from last year but continues to stay in line with the historical increases seen over the previous ten years.

How Is COLA Estimated?

The Department of Labor ultimately determines the annual COLA by analyzing the Consumer Price Index (CPI), a measurement of a comprehensive sampling of the cost of consumer goods and expenses. The CPI is always compared to the previous year and creates a simple formula on how COLA is determined; if there is an increase, there is a COLA. If there is no increase, there will not be a COLA. The COLA affects roughly one in every five Americans, including Social Security recipients, disabled veterans, federal retirees, and retired military members.


>> Frustrated with your VA disability rating?  Register for a free consultation for help with increasing your rating to get the compensation you deserve.  Please go here.


COLA Increase of 1.3% for 2021

Due to the COLA raise, retired Service Members will see roughly a $13 increase for every $1,000 in military retirement pay they receive each month.

Military retirees who joined the service on or after August 1st, 1986, and opted for the Career Status Bonus (CSB/Redux retirement plan) have any COLA increases reduced by 1% so that they will experience a smaller increase in 2021. They will see a monthly increase of only $3 per $1,000 instead of the average $13 increase most will see.

Military retirees and VA beneficiaries are not the only ones who will enjoy the perks from the COLA raise. Civil Service personnel and Social Security recipients will also experience a 1.3% jump in their monthly checks. The per month increase for Social Security recipients will mean an extra $18.07 per month for the average beneficiary.

Disabled Veterans Will Also Receive a Pay Increase

Disabled veterans will also receive a pay increase. The average VA disability check will rise roughly $1.85 per month for those with a 10% VA rating and $19.68 for those with a %100 disability rating from the VA.

It is critical to note that the traditional National Guard and Reserve Service Members’ retirement system is slightly different. For Active Duty Service Members, including active National Guard and Reserve Components, once they reach 20 years of active service, they can start receiving their retirement benefits almost immediately. Traditional (one weekend a month, two weeks a year) National Guard and Reserve service members who completed a minimum of 20 “qualifying” years of honorable service (creditable retirement years) can retire at the age of 60.

What is a qualifying year? A qualifying year is when the National Guard or Reserve member earns at least 50 retirement points. Inactive point credit is granted for inactive duty training, reserve membership, equivalent instruction, and correspondence courses.

The DoD’s Retirement Pay Calculator Page  can give you an estimate of your monthly retirement pay at age 60.


>> Frustrated with your VA disability rating?  Register for a free consultation for help with increasing your rating to get the compensation you deserve.  Please go here.





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