Good news is on the horizon for VA beneficiaries in 2025. Thanks to the Cost of Living Adjustment (COLA), VA benefits are set to increase at the start of the new year. This change, which mirrors adjustments in Social Security, is designed to help veterans keep pace with rising living costs. Here’s a breakdown of what veterans can expect from this adjustment and how it will impact their monthly payments.
What is COLA and How Does it Work?
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The Cost of Living Adjustment (COLA) is a mechanism used to adjust benefits based on inflation. Each year, COLA applies a percentage increase to VA benefits, ensuring that payments align with the current cost of living. This adjustment is crucial for maintaining the purchasing power of those who rely on VA Disability or other veteran-related benefits.
In 2025, the COLA increase is expected to be around 2.5%. This percentage will be applied to the current benefit amount you receive. The more significant your benefit, the larger the increase you’ll see. For example, if you’re receiving $3,600 per month from VA Disability, a 2.5% bump would raise your monthly benefit to approximately $3,690—an extra $90 each month, which totals over $1,000 over the year.
When Will the Increase Take Effect?
While the COLA increase will officially go into effect in January 2025, the exact percentage is yet to be confirmed. The Senior Citizens League, a group that monitors these adjustments, has predicted a 2.5% hike. The final rate, however, will be announced by the Social Security Administration in October 2024.
This timing means that the increase will not impact your payments in 2024. You can expect your first adjusted payment at the beginning of 2025. As always, VA payments are distributed on the 1st of each month unless that day falls on a weekend or holiday, in which case they are sent on the last business day prior.
How Will the COLA Increase Impact Veterans?
The primary goal of the COLA increase is to offset inflation and rising costs of essential goods like housing, food, and utilities. While the adjustment won’t drastically change anyone’s financial situation, it can provide meaningful relief. As one expert explained, “The COLA adjustment isn’t designed to make anyone wealthy, but it ensures that veterans can keep up with basic living costs without undue worry.”
The increase can make a significant difference depending on your VA disability rating. For instance, a veteran with a 100% disability rating currently receiving $3,836 per month could see their payment rise to around $3,932. That additional amount may seem modest, but it adds up over time and can be particularly useful for covering day-to-day expenses.
What Should Veterans Keep in Mind?
VA beneficiaries should remember that this increase will only affect payments starting in 2025. For the remainder of 2024, you’ll continue to receive the same amount as usual. This upcoming COLA adjustment will apply to all VA benefits, including Disability and other forms of veteran support.
It’s also important to know that COLA adjustments are part of an ongoing effort to help veterans cope with inflation. As costs of essentials rise, this annual increase ensures veterans can continue to maintain a reasonable standard of living without losing purchasing power.
Final Thoughts
The 2025 COLA increase is a welcomed boost for veterans relying on VA benefits. Though the adjustment may not be substantial, it offers important support as living costs continue to rise. Veterans can expect this change to take effect at the start of 2025, with official details about the percentage increase coming in October 2024.
For many, the extra money will help cover the increasing costs of housing, food, and utilities. While the COLA increase won’t make veterans rich, it will help ensure they can meet their basic needs without additional financial strain.