2027 Cost-of-Living Increase for Veterans, Military Retirees
If you are a military veteran, some of your VA benefits get a 3.6% cost-of-living adjustment, or COLA, in 2027. That’s thanks to the announcement made by the Social Security Administration on October 14, 2026 that the annual Cost of Living Adjustment for 2027 is set at 3.6%, keeping retiree and veteran benefits in line with inflation.
The adjustment technically takes effect on December 1. Because the federal government issues benefits in arrears, the higher payments first appear in deposits delivered at the end of December.
2027 Cost-of-Living Increase for Veterans, Military Retirees
The Social Security Administration’s COLA adjustment affects more than 70 million Social Security beneficiaries and those receiving veteran benefits. Military Times reports that the increase goes into effect in January and is 0.8% higher than the 2.8% COLA in 2026.
The 3.6% boost for 2027 follows 2.8% in 2026 and 2.5% in 2025. By comparison, the 2023 increase reached 8.7% during peak inflationary pressures.
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When the COLA Adjustment Begins for Veterans
Military retirees and disabled veterans will receive their cost-of-living adjustment starting with benefits paid in December 2026, marking the largest increase in four years.
The cost-of-living formula relies on the Consumer Price Index for Urban Wage Earners and Clerical Workers, compiled by the Bureau of Labor Statistics. The government calculates the rate by comparing third-quarter data for July, August, and September with the preceding year’s third-quarter index.
When prices rise over that three-month window, the percentage difference determines the adjustment for the upcoming calendar year. If the index shows no change or prices decline, benefit rates remain flat rather than decreasing.
In 2024, Congress also passed legislation tying increases in veterans benefits to the Social Security adjustment rate. The annual adjustment applies to Department of Veterans Affairs disability compensation, clothing allowances, dependency and indemnity benefits, and military pension plans.
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Veteran Benefit Increases in 2027
For a veteran receiving $1,500 per month in benefits, the 3.6% boost adds about $54 per month in 2027. Disabled veterans receive adjustments based on their assigned disability evaluation:
- Veterans rated at a 10% disability level see monthly checks rise by about $6.50.
- Veterans rated at 100% disability without dependents receive an increase of about $147.08 per month.
- For severely disabled veterans receiving Special Monthly Compensation, the monthly increase ranges from $176.43 to $405.75 depending on the specific tier.
- Dependency and Indemnity Compensation payments to surviving family members increase by about $61.18 per month.
- Military retirees receive $36 more each month for every $1,000 of retirement pension collected.
Exceptions apply to select retirement programs:
- Personnel who entered military service on or after August 1, 1986, and selected the Career Status Bonus under the CSB/Redux retirement track face a one percentage point reduction. These retirees receive an increase of $26 per $1,000 in monthly pension.
- Service members who retired during 2026 receive a prorated adjustment based on the quarter in which they left active service.
- Survivor Benefit Plan annuitants receive increases matching the percentage applied to standard military retirement payments.
Active-duty service members do not receive pay adjustments through this cost-of-living formula. Congress sets basic pay for active-duty troops separately through the annual National Defense Authorization Act.
For fiscal year 2027, the Senate proposed a flat 3.6% raise for service members, while the House approved a tiered raise spanning 5% to 7%. Lawmakers must settle the difference when Congress reconvenes after the midterm elections.
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About the author
Editor-in-Chief Joe Wallace is a 13-year veteran of the United States Air Force and a former reporter/editor for Air Force Television News and the Pentagon Channel. His freelance work includes contract work for Motorola, VALoans.com, and Credit Karma. He is co-founder of Dim Art House in Springfield, Illinois, and spends his non-writing time as an abstract painter, independent publisher, and occasional filmmaker.
