For disabled veterans, the annual Cost of Living Adjustment (COLA) is a crucial update that directly impacts their disability compensation rates. As we look ahead to 2026, here’s what you need to know about the projected COLA increase.

Projected 2026 COLA: Around 2.5%

Based on current estimates, the 2026 COLA is projected to be around 2.5%. Some forecasts indicate a range between 2.1% and 2.7%.

Important Note: This is a projection and not the final confirmed amount. The official 2026 COLA will be finalized in mid-October 2025 when the Social Security Administration (SSA) reviews the third-quarter inflation numbers (July, August, and September).

How This Impacts Your Benefits

  • Direct Increase: If confirmed, this increase will directly raise your 2026 VA disability compensation rates if you have a service-connected rating of 10% or higher.
  • Effective Date: These updated pay rates will take effect on December 1, 2025.
  • First Payment: You will see this increase reflected in your January 1, 2026, VA disability payment.
  • Dependents: Veterans with a combined disability rating of 30% or higher may also qualify for additional compensation for dependents (spouse, children, or dependent parents) based on the new rates.

How COLA is Determined

The COLA for VA disability benefits is tied by law to the COLA announced by the Social Security Administration. The SSA determines the COLA based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which tracks changes in the prices of consumer goods and expenses.

What to Keep in Mind

  • Projections Can Change: While current projections are helpful for financial planning, the final COLA can fluctuate based on inflation trends over the next few months.
  • No Cuts Enacted: Despite past discussions about potential changes to VA benefits, no cuts to VA disability benefits have been enacted. VA leadership has consistently expressed commitment to improving, not reducing, veteran services. Veterans’ benefits generally enjoy strong bipartisan support.

 

Stay tuned for the official COLA announcement in October 2025 for the definitive figure.