2.8% 2026 COLA Increase Announced, Veteran Benefits Affected
The Social Security Administration (SSA) has announced a Cost-of-Living Adjustment (COLA) for 2026. The new rate is 2.8% and is an important update for millions of Americans, including military retirees, disabled veterans, and surviving family members.
2026 COLA Increase
This 2.8% increase is applied to federal benefits to offset inflation and mitigate rising costs of goods and services. The new rates are reflected in payments received starting in January 2026. This cost-of-living increase affects veteran benefits but does not affect active-duty basic pay or military allowances, as we’ll examine below.
Why COLA Does Not Affect Active Duty Basic Pay or Allowances
A common point of confusion is whether the SSA COLA affects the paychecks of active duty, Guard, and Reserve service members. The short answer is no. The SSA COLA and the annual military pay raise are calculated using different methods and serve different purposes.
SSA COLA
This is a “cost-of-living” adjustment intended for retirees and beneficiaries to ensure their fixed income keeps up with inflation, calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers, or (CPI-W).
Military Pay Raises, Benefits Unaffected
This is NOT affected by the annual COLA increase announced by SSA. By law, this raise is tied to the Employment Cost Index (ECI), which measures the growth in private-sector wages, not inflation.
For 2026, the military basic pay raise is projected to be 3.8% based on the ECI. This figure must be approved by Congress and the President as part of the National Defense Authorization Act (NDAA).
Active Duty military allowances are not tied to the SSA COLA. That includes the Basic Allowance for Housing (BAH), which is updated annually based on the median cost of local rental housing and utilities in specific markets. It is not a nationwide COLA.
The Basic Allowance for Subsistence (BAS) is adjusted annually based on the cost of food, as measured by the U.S. Department of Agriculture’s food cost index. In short, the 2.8% SSA COLA applies to military retired pay and veteran benefits, while the separate 3.8% military pay raise applies to the basic pay of those still serving.
How COLA Affects Veteran Pay
By law, the COLA rate announced by the SSA is tied directly to the annual increases for most military and veteran benefits. Here is a breakdown of which benefits will increase by 2.8% and how it works.
For Military Retirees
Military retirement pay is adjusted annually by the COLA. This means all military retirees will see their gross retired pay increase by 2.8% starting in their January 2026 payment.
If your 2025 military retirement pay is $2,500 per month, for example, a 2.8% increase will add $70 to your monthly payment, bringing your new estimated pay to $2,570 in 2026.
There is an exception for those who retired under the REDUX system. Military members who opted for the $30,000 Career Status Bonus (CSB) and retired under REDUX receive a modified COLA that is 1.0% lower than the full COLA. For 2026, their adjustment will be 1.8%.
For Veterans Receiving VA Disability Compensation
Veterans receiving VA disability compensation get a 2.8% increase in their monthly, tax-free payments. The new rates apply to all disability ratings from 10% to 100%, including all additional compensation for dependents (spouses, children, and dependent parents).
For Veterans Receiving VA Pension
The VA Pension, a benefit for wartime veterans with low income who are aged 65 or older or have a permanent and total non-service-connected disability, will also increase.
The pension benefit is calculated based on a Maximum Annual Pension Rate (MAPR). For 2026, the MAPR amounts increase by 2.8%, allowing eligible veterans to earn more income while still qualifying for the pension.
For Survivors (SBP and DIC)
Survivors receiving benefits from the Department of Defense (DoD) or the Department of Veterans Affairs (VA) will also receive the 2.8% increase. Survivor Benefit Plan (SBP) payments, which are paid by the DoD to eligible survivors of military retirees, will increase by 2.8%.
Dependency and Indemnity Compensation (DIC), a tax-free benefit paid by the VA to the surviving spouses and children of veterans who died in the line of duty or from a service-connected disability, will also increase by 2.8%.
This includes the base monthly rate and all additional allowances, such as the 8-year provision, Aid and Attendance, and Housebound allowances.
2026 Benefit Rates with 2.8% COLA Increase
These rates become official on December 1, 2025. They are paid starting in the new year.
VA Disability Compensation Rates (Veteran Only, No Dependents)
- 10%: $180.43 (from $175.51 in 2025)
- 20%: $356.66 (from $346.95 in 2025)
- 30%: $552.47 (from $537.42 in 2025)
- 40%: $795.84 (from $774.16 in 2025)
- 50%: $1,132.90 (from $1,102.04 in 2025)
- 60%: $1,434.90 (from $1,395.93 in 2025)
- 70%: $1,808.45 (from $1,759.19 in 2025)
- 80%: $2,102.15 (from $2,044.89 in 2025)
- 90%: $2,362.30 (from $2,297.96 in 2025)
- 100%: $3,938.58 (from $3,831.30 in 2025)
Note: Rates for veterans with dependent spouses, children, or parents will also increase by 2.8% from their 2025 levels.
VA Pension (Maximum Annual Pension Rate – MAPR)
- Veteran (No Dependents): $17,429 (from $16,956 in 2025)
- Veteran with Spouse: $22,838 (from $22,216 in 2025)
- Veteran, Housebound: $21,313 (from $20,732 in 2025)
- Veteran, Housebound w/ Spouse: $26,709 (from $25,982 in 2025)
- Veteran, Aid & Attendance: $29,092 (from $28,300 in 2025)
- Veteran, Aid & Attendance w/ Spouse: $34,487 (from $33,548 in 2025)
Dependency and Indemnity Compensation (DIC)
- The Base Rate for the Surviving Spouse in 2025, at $1,653.07, will increase to an estimated $1,699.36 per month in 2026.
- 8-Year Provision for the 2025 add-on of $351.02 will increase to an estimated $360.85 per month. The 8-year provision is a VA DIC option for qualifying surviving spouses whose veterans were rated totally disabled “for at least eight continuous years before death.”
- Aid & Attendance add-ons of $409.53 increase to an estimated $420.99 per month.
- Housebound add-ons of $191.85 will increase to an estimated $197.22 per month.
Survivor Benefit Plan (SBP):
- There is no fixed rate for the VA Survivor Benefit Plan, as it is based on the retiree’s pay. SBP recipients will see their current monthly payment increase by 2.8%.
- A 2025 SBP payment of $1,200 per month will increase to an estimated $1,233.60 per month in 2026.
Frequently Asked Questions About SSA COLA
What is the 2026 Cost-of-Living Adjustment (COLA)?
The Social Security Administration (SSA) has announced a 2.8% COLA for 2026.
When does the 2.8% COLA take effect?
The new rates are reflected in payments received starting in January 2026.
Who receives the 2.8% COLA?
The 2.8% increase applies to military retirees, veterans receiving VA disability compensation, veterans receiving VA Pension, and survivors receiving Survivor Benefit Plan (SBP) or Dependency and Indemnity Compensation (DIC) benefits.
Does this COLA affect active duty military pay?
The 2.8% SSA COLA does not affect the paychecks of active duty, Guard, or Reserve service members.
Why doesn’t the SSA COLA apply to active duty pay?
SSA COLA and the annual military pay raise are calculated using different methods. The SSA COLA is for retirees and beneficiaries, intended to offset inflation using the Consumer Price Index (CPI-W). The military pay raise is tied by law to the Employment Cost Index (ECI), which measures private-sector wage growth.
What is the active duty military pay raise for 2026?
The 2026 military basic pay raise is projected to be 3.8%. This figure must be approved by Congress and the President.
Are military allowances like BAH and BAS affected by the COLA?
No. The Basic Allowance for Housing (BAH) is updated annually based on local rental housing costs, and the Basic Allowance for Subsistence (BAS) is adjusted based on the cost of food. Neither is tied to the SSA COLA.
How will the COLA affect military retirees?
Military retirement pay is adjusted annually by the COLA. Retirees will see their gross retired pay increase by 2.8% starting in their January 2026 payment.
Are there any exceptions to the 2.8% COLA for military retirees?
Yes. Military members who retired under the REDUX system and opted for the Career Status Bonus (CSB) receive a modified COLA that is 1.0% lower than the full rate. For 2026, their adjustment will be 1.8%.
Will VA Disability Compensation payments increase?
Yes. Veterans receiving VA disability compensation will get a 2.8% increase in their monthly payments. This applies to all disability ratings and additional compensation for dependents.
Will the VA Pension benefit increase?
Yes. The VA Pension is calculated using a Maximum Annual Pension Rate (MAPR). For 2026, the MAPR amounts will increase by 2.8%.
Will survivor benefits increase?
Survivor Benefit Plan (SBP) payments and Dependency and Indemnity Compensation (DIC) payments will increase by 2.8%. This includes the DIC base monthly rate and all additional allowances, such as those for Aid and Attendance or Housebound status.
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.
