Retired pay, in dollars
DoD adjusts military retired pay each December 1 under 10 U.S.C. § 1401a, using the third-quarter consumer price index. Social Security uses the CPI-W for July through September. Those two calculations matched in recent years, including 2.8% for 2026. Use 3.6% as the planning number for Final Pay, High-3, and Blended Retirement System retired pay. Read the DFAS notice and your Retiree Account Statement before you spend it.
A full 3.6% COLA is $36 a month for each $1,000 of retired pay. A $2,500 pension is about $90 more. A $4,000 pension is about $144 more. Retired pay is taxable. This raise is not tax-free.
| Who | Adjustment |
|---|---|
| Final Pay, High-3, BRS | Full COLA. Plan on 3.6%. |
| CSB/REDUX | One point less when the COLA is above 1%. That is 2.6%, or $26 per $1,000. |
| Retired during 2026 | Usually a partial first COLA. The quarter you retired changes it. Ask DFAS. |
| Survivor Benefit Plan | Same percentage as the retiree COLA, on the annuity payday. |
Method: DoD retirement COLA. The 3.6% announcement: Social Security, October 14, 2026. SSI's higher payment starts December 31, 2026.
VA disability is the same percentage and a separate law
Disability compensation amounts do not index themselves. Each year Congress passes a short bill that tells VA to match the Social Security percentage for wartime disability compensation, extra pay for dependents, the clothing allowance, and dependency and indemnity compensation (DIC) for surviving spouses and children.
This year's bills are H.R. 8552 and S. 4487. The text sets the increase on December 1, 2026. As of November 1, 2026, neither bill had been signed. Congress passes this adjustment year after year, so 3.6% is the likely outcome. It is not a rate on VA.gov yet.
VA pension, and DIC for parents, rise with Social Security under 38 U.S.C. § 5312 without that bill. If a post says VA already published 2027 rates, ask which benefit it means.
For a sketch, multiply your current compensation by 0.036. On the 2026 veteran-alone 100% rate of $3,938.58, that is about $142 a month. Official cents can differ after VA rounds. The VA disability calculator still uses 2026 tables. Those rates are listed in the 2026 COLA guide.
What to hand a lender
Lenders can count VA disability compensation and military retired pay. Give them the current award letter and the current RAS. Say a compensation COLA bill is pending if they ask about next year's income. Keep the mortgage sized to today's pension. Treat December's increase as margin. The housing version of that math is in retirement real estate. If you receive both checks, concurrent receipt still decides how much of the pension you keep.
Basic pay for people still serving is a different raise. The January 2027 percentage is still between the House and the Senate. See the FY2027 NDAA explainer.
What to do this week
- Copy retired pay and VA compensation from the statements, not from memory.
- For retired pay, wait for the DFAS notice and the RAS before you lock a new budget.
- For disability compensation, keep using the 2026 table until VA publishes the new one.
- If you retired in 2026, ask DFAS which partial COLA applies.
- If you are buying, take the current letters to a VA-savvy lender.
