2013 Retiree COLA Announced

The 2013 Cost of Living Adjustment (COLA) for all military retirement pay, Survivor Benefit Plan (SBP) annuities, Social Security benefits, and Veterans Affairs disability and survivor benefits has been announced.  The adjustment will provide a 1.7% increase in those payments, effective 1 December 2012.  Since those benefits are paid in arrears, the change will first be seen in the January 2013 payments which are scheduled to be direct deposited on 31 December 2012.

Two groups of military retirees won’t receive a 1.7% COLA: 

2012 Retirees:  Servicemembers who retired during 2012 will receive a reduced COLA for this year only, because they weren’t in retired status for the full year.  Their reduced COLAs generally reflect the amount of inflation experienced in the calendar quarters since they retired.  Jan.-Mar. retirees will receive 1.7%;  Apr.-Jun. retirees, 1.0%;  and Jul.-Sept. retirees 0.2%.  Those who retire after Oct. 1, 2012, will see no COLA this year.  All members who retired during 2012 will receive full-year COLAs in future years. 

REDUX Retirees:  Servicemembers who entered service on or after Aug. 1, 1986 AND who elected to accept a $30,000 Career Retention Bonus (CRB) at 15 years of service will receive a 0.7% COLA this year. In the agreement under which these servicemembers accepted the CRB, they also agreed to accept reduced retired pay and COLAs as a trade-off for the bonus.  REDUX retirees’ COLAs are 1% below the normal COLA rate.

I am glad that there will be some COLA adjustments this year, even if it isn’t as much as many people would like.  Get out your calculators!

About the Author

Kate Horrell
Kate Horrell is a military financial coach, mom of four teens, and Navy spouse. She has a background in taxes and mortgage banking, and a trove of experience helping other military families with their money. Follow her on twitter @realKateHorrell.
  • Sarge62

    I was active duty for 10yrs and an active reservist for 11yrs. I am told that I dont get a pension until I am 60—Thats another 10 years. I am ok with that, except I cant find out how much $’s. I retired as an E-7. Can any one help me?

    • CSM ret.

      Did you get a NGB 23?

  • USAF Chief

    Go to the Army Reserve Retirement Calculator:

  • AZ Border Dude

    According to the DFAS table of retired payment dates, the December 2012 pay (dates 1 – 31) is scheduled to be deposited on 31 Dec 2012. This should include the pay raise.
    The January 2013 pay (dates 1-31) is scheduled to be deposited on 1 Feb 2013.
    The confusion on this began when DFAS went to the new scheme when the 1st of the next month is on a weekend or holiday, the pay dates occur on the last business day of the month being paid.
    In 2013 those months are May, August, November & December.
    We should be getting the pay change notice in a couple of weeks.

  • James

    Does this 1.7% for COLA also count for CRSC?

  • KateKashman

    James, it should. Since Combat Related Special Compensation is specifically tied to VA compensation, it should reflect the same increases.