In a bid to offer much-needed financial relief to veterans, President Joe Biden signed the Veterans Compensation Cost-of-Living Adjustment (COLA) Act of 2023 into law on June 14, 2023. This ensures that veterans will receive a cost-of-living adjustment for their benefits in 2024, aligning with the COLA applied to Social Security benefits. The COLA increase aims to ensure that veterans’ financial support keeps pace with the ever-increasing costs of living.
Which VA Benefits Will See an Increase?
The upcoming COLA increase will impact a range of VA benefits, including:
- Disability Compensation: Veterans receiving disability compensation will receive higher payments, providing financial relief to those who have served and made sacrifices for their country.
- Clothing Allowance: Veterans eligible for a clothing allowance will benefit from the COLA increase, helping to cover the costs of clothing needed due to a service-related disability.
- Dependency and Indemnity Compensation (DIC): Spouses and children of deceased veterans receiving DIC will also see an increase in their benefits, assisting them in dealing with the financial challenges they may face.
The exact percentage increase for 2024 has not yet been determined and will be calculated based on the Consumer Price Index (CPI). The CPI measures the average change in prices of goods and services compared to previous years. This index is used by the Social Security Administration (SSA) to determine the annual COLA, which now applies to VA benefits as well.
When Can Veterans Expect the Adjustment?
Typically, the Social Security Administration announces its annual COLA early in the next fiscal year, beginning on October 1. Following this announcement, the Department of Veterans Affairs (VA) adjusts its compensation payment rates accordingly. Veterans can then anticipate seeing the new benefit amounts starting with their January 2024 payment.
This positive development comes after veterans and Social Security recipients experienced the most substantial COLA increase in decades in the previous year, with an 8.7% raise due to high inflation rates. However, it’s important to note that the increase for 2024 may vary, depending on various economic factors, including the Consumer Price Index.
Please bear in mind that this information is subject to change as new details emerge regarding the 2024 COLA adjustment.