On June 14, 2023, President Joe Biden signed into law the Veterans Compensation Cost-of-Living Adjustment (COLA) Act of 2023, which directs the Department of Veterans Affairs to provide a cost-of-living adjustment for Veterans benefits in 2024 equal to the COLA applied to Social Security benefits, as determined by the Social Security Administration (SSA).
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.
Which VA benefits will increase?
The COLA will affect certain VA benefits including, but not limited to: disability compensation, clothing allowance and dependency and indemnity compensation (DIC) for spouses and children.
While the exact amount of next year’s adjustment has not been determined, it’s based on the Consumer Price Index (CPI). The CPI measures the average change in prices of goods and services to preceding years and is used by SSA to determine the annual COLA, which, by law, now applies to VA benefits as well.
The last adjustment in January 2023, which Veterans are currently receiving, saw an 8.7% increase following a second year of high inflation.
When can Veterans expect to see the adjustment?
Based on the timeline of previous years, SSA is expected to announce its 2024 COLA early in the next fiscal year, which begins on Oct. 1. VA will then set its compensation payment rates to match and Veterans can expect to see the new amounts starting with their January 2024 payment.
To stay informed on when the COLA is announced and what it will mean for your VA benefits, subscribe to the #VetResources newsletter and #theSITREP podcast, where that topic and many more of interest to Veterans are discussed.
