Federal Benefits Increase for Veterans and Families
Increased Benefits for Veterans and Families
Veterans and their families will see higher federal benefits in the coming year. Burial reimbursements are increasing, along with a potential significant cost-of-living adjustment (COLA) for disability compensation. This could mean an increase of approximately $1,800 annually for some individuals.
“For veterans and their families, these increases may look modest on paper, but they provide additional support for dealing with the everyday costs of disabilities and funerals,” said Alex Beene, a financial literacy instructor at the University of Tennessee at Martin.
Reason for the Increase
The Department of Veterans Affairs regularly adjusts benefits to keep pace with inflation. For disabled veterans, a larger COLA in 2027 means larger monthly checks. Surviving relatives will benefit from increased burial allowances, helping offset rising funeral costs.
Inflation has moderated from pandemic highs, yet many still face financial pressure. Food banks report increased demand, attributing this to higher grocery prices and the end of some assistance programs. Americans face challenges from higher costs, including gas prices and rising home expenses like insurance and property taxes.
Upcoming Changes: Disability Benefits
The VA expects to finalize its 2027 disability compensation increase after the September inflation report on October 14. Warrior Disability forecasts a 2027 COLA of 3.2% to 3.6%, based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which also determines Social Security adjustments. This forecast is higher than the 2.8% increase in 2026 and 2.5% in 2025.
“These adjustments prevent benefits from losing purchasing power, important for veterans relying heavily on VA compensation,” Beene stated.
A projected 3.2% increase would raise payments for a 10% disability rating from about $180 to $186 monthly, adding around $69 annually. A veteran with a 100% disability rating, a spouse, two dependent parents, and one child could see an annual rise of about $1,794, with monthly payments growing from $4,671 to $4,821.
Final COLA figures depend on September inflation data and could differ from current projections.
Burial Benefit Increases
VA burial allowances have increased for fiscal year 2026. Families can receive $1,002 for non-service-connected burials and an additional $1,002 in interment allowances if the burial is outside a national cemetery. Previously set at $978, service-connected death reimbursements remain at $2,000.
Funeral costs have risen, with the National Funeral Directors Association reporting a median funeral cost of $8,300 in 2023, excluding extra fees that increase the total.
Who Benefits Most?
Approximately 6.3 million veterans receive disability compensation. The increase favors veterans with higher disability ratings, especially those with additional dependent compensation. Larger monthly checks see more significant dollar increases, benefiting veterans with higher payments.
The burial benefit increase significantly assists families dealing with substantial funeral expenses outside the national cemetery system.
Reasons Behind the Changes
The disability increase addresses inflation, calculated through the CPI-W formula. As consumer prices rise, veterans’ compensation generally follows.
“A 3.2% to 3.6% COLA increase would be welcomed, yet the impact of higher prices is already felt today,” noted Kevin Thompson, CEO of 9i Capital Group.
Thompson highlights the rising cost of living, escalating burial expenses, and external factors like foreign entanglements and tariffs impacting import prices.
The VA adjusts burial benefits to align with changing costs, ensuring reimbursements remain consistent with funeral expenses.
Next Steps
The official 2027 disability COLA will be released following the September inflation report on October 14. The increase will be included in VA payments from late 2026 into early 2027. Meanwhile, higher burial reimbursements are already active.