The 2021 COLA (Cost-of-Living Adjustments) increase is 1.3% as announced by the Social Security Administration. The 1.3 percent increase in the cost-of-living adjustment is about a $20 monthly benefit increase for the average retiree, or about $240 per year. COLA is based on the percentage increase of the Consumer Price Index for Urban Wage Earners and Clerical Workers for the third quarter of this year.
2021 COLA Increase: For more information read about the 2021 COLA increase watch.
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2021 Cola Effective & Payment Dates
- Retired military veterans, VA rates for compensation and pension for disabled veterans and surviving families will be effective December 1, 2020 and will be reflected on the first check to be paid on December 31, 2020.
- Social Security benefits will be effective beginning with December 2020 benefits, which are payable in January 2021.
- Federal SSI payment levels will begin on December 30, 2020.
COLA (Cost-of-Living Adjustments) are for the following individuals or areas:
- Retired Military Veterans
- Disabled Veterans – See VA Disability Rate Tables
- Veterans’ Pension Benefits – Veterans Pension Rate Tables
- Survivor Benefit Annuitants – Survivors’ Pension Rate Tables
- Surviving Families of Veterans – Parents’ Dependency and Indemnity Compensation (DIC) Tables
- Social Security recipients
- Federal Civilian Retirees
- Supplemental Security Income (SSI)
- Social Security Disability Insurance (SSDI)
- Eligibility for Medicare Extra Help and Medicaid
- Federal & State food and housing assistance programs
How COLA is Determined
The Cost-of-Living-Adjustment (aka Cost-of-Living Allowance) is determined by the Bureau of Labor Statistics’ Consumer Price Index (CPI-W). It is based on the percentage increase of the CPI-W from the 3rd quarter of the previous year versus the current year’s 3rd quarter (July, August, and September).
Veterans who retire during the current calendar year will receive a temporary partial COLA due to already receiving a military pay raise in January.
|Third quarter total||750.599||754.999|
|Average (rounded to the nearest 0.001)||250.200||253.412|
|Inflation According to the CPI-W||1.6%||1.3%|
|History of COLA (cost-of-adjustments) since 1975|
|Money & Finance||COLA Increase Watch|
|VA Disability Rates||Social Security|