Updated Oct. 13 to reflect new release date.

Military retirees, Social Security recipients, and others receiving federal funds with a cost-of-living adjustment (COLA) should learn the amount of that increase for 2026 later this month … but a look at the figures so far gives a good indication where COLA will end up.

Should inflation trends continue, expect an adjustment between 2.7% and 2.8% for the coming year – outpacing this year’s 2.5% figure, but below other recent annual increases of 3.2%, 8.7%, and 5.9%. This projection mirrors others made after the release of August’s inflation figures, which showed a 2.8% yearly change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

The September CPI-W figure -- the final figure required for the 2026 calculations -- will be announced Oct. 24 as part of a CPI report delayed by the shutdown. It had been set for an Oct. 15 release. 

[RELATED: MOAA’s COLA Watch Page]

This adjustment preserves the value of uniformed retirement and VA disability pay in the face of inflation. That’s why MOAA tracks COLA: It’s a key part of ensuring service-earned benefits remain strong … and it has come under significant threat in the past.

There are no current legislative efforts to remove or downgrade the adjustment, but MOAA continues its work to educate lawmakers on the significant impact any such move would have on military retirees. This is especially important as a cost-saving change to COLA calculations regularly appears on the Congressional Budget Office’s list of options to reduce federal spending. Such a move may help the government’s bottom line, but it would come at the expense of retirees and their families, unfairly weakening their earned benefits.

How Do You Calculate COLA?

July, August, and September CPI-W figures are used to calculate the coming year’s COLA through an established formula:

• Find the average CPI-W from those months in the current calendar year.
• Subtract the average CPI-W from those months in the previous calendar year.
• Divide the result by the average CPI-W from those months in the previous calendar year.
• If the result is a negative number, COLA is zero for the year (the benefit does not decrease).

Using last year’s calculation as an example: The 2024 three-month average (308.729) minus the 2023 three-month average (301.236) yields 7.493. Divide that by the 2023 average to get 0.0248, and round up for a 2.5% COLA.

The July 2025 figure of 316.349 represented a 2.5% increase from last year’s average. CPI-W increased nearly a full point (317.306) in August, but barring an unexpected spike in the September figure, the three-month average should settle between 2.7% and 2.8% above last year.

MOAA will update its COLA Watch page with final figures shortly after their release. Visit MOAA.org/finance for a full slate of financial resources, to include upcoming webinars and member-exclusive publications.