Millions of veterans are set to receive a boost to their disability benefits next year after the federal government announced a 3.6 percent cost-of-living adjustment for 2027, but some recipients say the increase will not be enough to compensate for their rising everyday expenses.
The 3.6 percent COLA announced by the Social Security Administration on Wednesday will also apply to Department of Veterans Affairs (VA) disability compensation once Congress passes the required legislation and it is signed into law.
The adjustment will be the largest since 2023 and follows increases of 2.8 percent for 2026 and 2.5 percent for 2025.
For veterans receiving VA disability compensation, the increase could range from roughly $6.50 more per month for someone with a 10 percent disability rating to about $142 more for a veteran rated 100 percent without dependents.
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But, Michael Ryan, a finance expert and the founder of MichaelRyanMoney.com, said there’s lingering frustration for veterans.
“For someone living primarily on disability benefits, every dollar helps. But here's what frustrates me,” Ryan said. “A cost-of-living adjustment measures how much prices have risen on average. It doesn't measure whether someone can actually afford to live.”
Why It Matters
More than 6 million veterans receive VA disability compensation.
The COLA is particularly important because VA disability compensation is a tax-free monthly benefit for eligible veterans with service-connected medical conditions. The amount received depends partly on the veteran's disability rating and eligible dependents.
COLA is intended to help benefits maintain purchasing power as prices rise. So a larger COLA doesn’t necessarily mean you will be benefitting. It instead reflects the inflation on everyday costs that you’ve already been dealing with.
How Much Will VA Benefits Increase?
For veterans without dependents, applying the 3.6 percent adjustment to the existing 2026 disability rates will create the following increases:
These are estimates, not the official rates as the VA has not yet released its final 2027 compensation tables.
But based on the information currently released, a veteran rated at 100 percent with a spouse and one child is estimated to receive $4,474.47 per month in 2027, compared with $4,318.99 in 2026. That’s an increase of about $155.48.
“The extra amount depends on their percentage rating and can vary from a few dollars a month to over $100,” Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek. “The concern for some veterans is the same as those who receive Social Security checks in that both groups are worried that as prices on everyday items continue to rise, the 3.6 percent increase won't ultimately be enough to cover their expenses.”
Other veteran payments will receive the adjustment, as well. Military.com said that Special Monthly Compensation and Dependency and Indemnity Compensation for survivors will rise 3.6 percent, while military retirees generally will receive another $36 per month for each $1,000 of military retirement pension.
“The difficult part is it's too soon to tell if the increase is going to be enough,” Beene said. “If there are resolutions to ongoing military conflicts in the coming months, the COLA could be more than enough. However, if tensions continue to rise, it could be possible the 3.6 percent bump won't match the pricing increases beneficiaries experience.”
Why Some Veterans Say the COLA Isn't Enough
For some recipients, the issue is not whether their checks are increasing, but whether the additional money will cover the expenses they encounter each month.
"The COLA never really keeps up with inflation. The extra dollars each month for someone who is 100 percent disabled are not life-changing,” Adam Jacob, a Marine Corps and Army veteran with a 100 percent VA disability rating for PTSD, told Stars and Stripes. "I live from check to check and am running out of money at the end of each month."
Other veterans have expressed similar concerns. One posting on TikTok, under the account @the_semper_patriots, said the increase could provide some relief but questioned whether it would go far enough.
"With ever-rising inflation and these uncertain diesel and gas prices, 3.6, depending on whether or not you're on Social Security or VA compensation, or a combination of both, it can help a little bit. At least cover one extra bill. But if things continue down the route that they're going, 3.6 honestly just doesn't seem like it's going to be enough."
The concerns are not confined to veterans. A recent AARP survey found 76 percent of older Americans said the COLA does not keep up with consistently rising prices.
“COLAs are lagging indicators, meaning the price you receive is quite often used to offset the prices you had already paid, not the prices you will be paying," Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek. "Higher prices tend to beget higher prices and just become a self-perpetuating system.”
The Social Security COLA is calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. The 2027 figure is based on the average CPI-W readings for July, August and September 2026 compared with the corresponding period in 2025.
VA disability compensation is adjusted by the same percentage.
However, Social Security and military retirement have statutory mechanisms that trigger their adjustments automatically. Congress must pass legislation directing the VA to apply the adjustment to disability compensation each year.
Could the COLA Understate Veterans' Costs?
An ongoing criticism of the COLA formula is that the CPI-W measures spending patterns among urban wage earners and clerical workers rather than veterans or retired households specifically.
That means the CPI-W may not accurately capture the inflation experienced by older households, especially as the Consumer Price Index for the Elderly has outpaced CPI-W in recent years due to rising healthcare costs.
Housing, healthcare, gasoline or grocery costs can also represent very different shares of household budgets depending on age.
“A veteran dealing with disabilities may have higher transportation costs, medical expenses or need help around the house,” Ryan said. “Those bills don't conveniently rise by the government's inflation percentage. And remember, a COLA doesn't undo the price increases from previous years. It raises benefits from today's level, when many households are already stretched thin.”
What Happens Next
The benefit adjustment is scheduled to take effect December 1, once the required veterans COLA legislation is enacted. Veterans should expect the higher VA disability rate to be reflected in their payment made on December 31 or in early January.
Newsweek’s reporters and editors used Martyn, our AI assistant, to produce this story. Learn more about Martyn here.
Contact Newsweek editors on this story: Jason Lemon and Dave Siminoff.