Lower COLA For Retired Military and Disabled Veterans in 2024
The Department of Veterans Affairs announced a Cost of Living Adjustment or COLA increase of 3.2% for retirees and disabled veterans effective November 30, 2023, “for the payment of disability compensation and dependency and indemnity compensation,” according to the text of Public Law 118–6 by the 118th Congress.
How Much is the 2024 COLA Increase?
Stripes.com notes that a COLA of 3.2% “would raise an average monthly retiree benefit of $1,790 by $57.30.”
2024’s increase is lower than the 8.7% COLA for 2023. It’s also lower than 2022’s 5.9% adjustment. Both years had higher COLA numbers because of inflation, which the Cost of Living Adjustment is meant to offset.
Not A Permanent Adjustment
It should be noted that nowhere in Public Law 118-6 will you find language saying this COLA increase legislation is to happen in perpetuity.
It only mentions the 2024 COLA adjustment specifically and does not contain language authorizing a permanent change in COLA tied to the Social Security COLA increase.
VA.gov notes that such COLA laws are passed year-to-year, “The legislation passed with bi-partisan support in the House and Senate, is an annual procedure for Congress but an important one, as it must be accomplished to ensure Veterans receive a COLA, and that it keeps pace with inflationary costs.”
Who is Affected by the COLA Increase
The 2024 Cost of Living Adjustment applies to certain VA benefits, including, but not limited to, those in the following categories as listed in the text of Public Law 118-6. If you are eligible for one or more of the following benefits, they will increase by 3.2% in 2024:
- Wartime Disability Compensation
- Clothing Allowance
- Dependency And Indemnity Compensation To Surviving Spouses
- Dependency And Indemnity Compensation To Children
According to the text of the law, COLA increases for the veteran/retiree benefits listed above, “shall be increased by the same percentage as the percentage by which benefit amounts payable under title II of the Social Security Act…”
How Cost of Living Adjustments are Determined
Cost of Living Adjustments are determined by the national Consumer Price Index (CPI), which is used to average the change in prices of goods and services from prior years.
Social Security and other government agencies in the past used this formula for adjustments. In 2023, the VA must use the formula, too, thanks to changes in federal law (see below.)
Why Make COLA Adjustments?
In June 2023, Congress passed the Veterans Compensation Cost-of-Living Adjustment Act. Signed into law by President Joe Biden, the law requires the Department of Veterans Affairs to make cost-of-living adjustments for Veterans benefits in 2024 equal to the COLA applied to Social Security benefits, as determined by the Social Security Administration (SSA).
Related: Financial Planning for Military and Veterans
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.
