Each year your military retirement pay is adjusted to meet the increased cost of living. This Cost of Living Adjustment varies from year to year based on the Consumer Price Index (CPI).

The COLA for 2006 will be 4.1 percent for retired pay, SBP annuities, Social Security, and veterans disability compensation effective December 1, 2005 and will be seen in the January 15, 2006 paycheck.

Retirees who first became a member of a Uniformed Service before September 8, 1980 and retired after January 1, 2005 will receive a 3.4 COLA.

Retirees who first became a member of a Uniformed Service on or after September 8, 1980, will receive a COLA according to the effective date of their retirement as follows:

Retirement Effective / Percent Increase

Before January 01, 2005 - 4.1 percent

January 01 - March 31, 2005 - 3.4 percent

April 01 - June 30, 2005 - 2.8 percent

July 01 - September 30, 2005 - 1.4 percent

October 01 - December 31, 2005 - 0.0 percent