Official military pay raise data is typically released each year at the end of October. For 2011, no cost of living adjustment (COLA) for military retirees and social security recipients appears in sight.
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Military Retiree Pay Raises Tied to the Economy

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Official military pay raise data is typically released each year at the end of October. For 2011, no cost of living adjustment (COLA) for military retirees and social security recipients appears in sight.

MILITARY RETIREE PAY RAISES MIRROR INFLATION

According to law, the annual military retiree pay raise mirrors increases on the Consumer Price Index (CPI). The CPI is the measurement for inflation, which is quantified by comparing inflation in the third quarter of each year.

According to the Federal Government, a lack of military retiree pay raise is connected to a lack of inflation. For 2011, making a second consecutive year, the CPI inflation rate is projected to be negative which translates to a zero military retiree pay raise.

By law, if inflation increases from year to year (third quarter to third quarter), military retirees receive a pay raise tied to the COLA, beginning in January. If inflation does not increase or is negative, military retiree pay remains the same as the previous year.

MILITARY RETIREE PAY RAISES REFLECT THE ECONOMY

The 2009 retired military pay increase was the most dramatic: 5.8 percent in 2009, making the largest military retiree pay increase increase in 27 years. The retired military pay increase was attributed to the 2008/2009 spike in energy prices, thus showing how the economy directly affected veterans retired pay.

INCREASES IN SOCIAL SECURITY

The CPI is also the measurement used to compute COLA increases in Social Security, and VA Compensation and Pensions. Thus, for 2011, military retirees who also receive monthly social security wages will see no increase in their social security payments.

Officially, the U.S government does not announce annual military pay increase rates until the end of October. However, COLA numbers are usually in earlier than October, and experts can predict military retiree pay raises prior to the official announcement.



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