2025 Guidance on Pay and Allowances for Military Service Members, Veterans, and Retirees

Editor’s Note: This is the first installment of New year, new you, a one-week look at your financial health heading into 2025.

Many U.S. military service members anticipate significant increases in their salaries and benefits in 2025, including a 14.5% pay increase for junior enlisted troops and an average 5.4% increase in the basic housing allowance (BAH) rates, which vary depending on location and other factors.

Meanwhile, veterans, retirees and survivors will receive a 2.5% increase in their benefits in 2025, according to the Social Security Administration’s annual cost-of-living adjustment (COLA).

These are some of the salaries and benefits that U.S. military service members and veterans may be eligible to receive in 2025.

Military basic salary 2025

Not all active duty service members will receive the same percentage increase in their base pay in 2025 due to two factors:

Congress authorized a biggest increase for young enlisted troops in 2025.
Senior officers’ salaries are capped lower than those of certain civilian government executives.

Because younger enlisted members found it more difficult to meet basic needs, among other reasons, Congress approved a 14.5% raise for troops with pay grades E-1 through E-4 in the Authorization Act of National Defense for fiscal year 2025, along with a 4.5% increase for everyone else linked to the Employment Cost Index, except those whose salary could not exceed a certain limit by law.

The 4.5% raises, and smaller increases for officers who hit the salary cap, began Jan. 1, including E-1 through E-4, who get the remaining 10% starting in April.

Some officers will not receive the full 4.5% pay increase because their pay has reached a cap. All O-10s, all O-9s and O-8s with 30 or more years of service will earn the same amount of base pay in 2025 because their pay (along with that of O-7s, but did not meet the cap) must not exceed that of Level 2 of the federal Executive Program for civil payment. All of those senior officers will earn $18,808.20 per month in base pay to stay below the Tier 2 civilian rate of $225,700 per year.

See 2025 military pay tables.

2025 Basic Housing Subsidy (BAH)

The average BAH will increase by 5.4% in 2025 for the second year in a row. Around a million military personnel receive the benefit. The new rates came into effect on January 1.

BAH’s calculation assumes that service members will absorb 5% of their housing costs, meaning they will pay between $90 and $202 out of pocket in 2025, depending on their rank, their location and whether they have dependents. Local housing and utility costs determine BAH rates, so while most go up each year, some go down. However, in those areas, service members who already live there can keep their current rate.

The 5.4% average increase represents another larger than normal rate increase. The 12.1% increase in 2023 was higher than the 5.1% in 2022.

Calculate your BAH rate for 2025 here.

2025 CONUS TAIL

In addition to the BAH, some service members in areas with a particularly high cost of living (costs not limited to just housing) receive the Continental United States Cost of Living Allowance (CONUS COLA).

Many more troops will receive the allocation in 2025. All areas that will receive the CONUS COLA in 2025 are in California, Massachusetts or New York. About 61,000 service members will receive a total of about $51 million in CONUS COLA payments in 2025, compared to 17,000 who will receive $26 million in 2024 and 5,000 who will receive $8 million in 2023.

These are the military CONUS COLA rates for 2025.

2025 Basic Subsistence Allowance (BAS)

Service members will receive a few dollars more per month for meals in 2025. The monthly Basic Subsistence Allowance, or BAS, covers the cost of meals only for service members, not their dependents.

BAS rates will increase approximately 1.2% in 2025, from $460.25 to $465.77 per month for enlisted members; and from $316.98 to $320.78 for officers.

2.5% COLA for veterans and survivors benefits

Various benefits for veterans and their survivors increase each year based on the Social Security Administration’s annual cost-of-living adjustment, or COLA (not an allowance like the CONUS COLA, but rather an overall percentage increase in payments). This includes the salary of retired military personnel.

He Department of Veterans Affairs‘ COLA-based increases take effect on December 1 of each year. The increase for 2025 amounts to 2.5%. That’s down from the 2024 COLA of 3.2% and 8.7% in 2023, which was the highest in decades.

The following benefits received the 2.5% increase:

VA Disability Payment 2025

The tax-free payments are for veterans with at least 10% disability due to a service-connected physical or mental health condition. Rates range from $175.51 per month for a 10% disabled veteran in 2025 to $4,544.23 per month for a 100% disabled veteran with a spouseson and two dependent parents. Rates for additional children and spouses who require help and assistance They vary depending on the veteran’s disability rating.

See VA disability payment rates for 2025.

Special Monthly Compensation 2025

Veterans receive the VA Special Monthly Compensation benefit if they lost or lost the use of a limb or certain organs or limbs due to military service. Monthly rates range from $4,288.45 to $11,521.15 in 2025.

See the 2025 Special Monthly Compensation rate.

Veterans pension 2025

Veterans who are age 65 or older, or who are permanently and totally disabled and with limited income can receive the VA Veterans Pension, even if they do not have a known service-connected injury or illness. To receive it, the veteran must have served at least 90 days on active duty, and at least one day during wartime.

By 2025, a veteran or a married couple must own less than $159,240 in assets for the veteran to qualify.

The Veterans Pension makes up the difference between household income and a designated threshold or income limit. For a single veteran with no dependents, the VA will pay the difference between the veteran’s annual income and $16,956 in 2025; while the income limit for a veteran who needs aid and assistance and has a dependent is $33,548.

See 2025 Veterans Pension rates.

Survivor Pension 2025

Certain survivors of deceased war veterans may also receive a pension, but the rates are lower and the service requirement is higher. A deceased veteran must have served at least 24 months on active duty, and at least one day during wartime.

The VA will make up the difference between the annual income of an unremarried surviving spouse or an unmarried child and $11,380 in 2025. The income limit is $21,696 a year for a surviving spouse requiring assistance and assistance and also has a dependent.

Here are the Survivor Pension rates for 2025.

2025 VA Dependency and Indemnity Compensation (DIC)

Dependency Compensation and Indemnity (DIC) is a rate received by survivors of certain deceased veterans. In 2025, the base rate is $1,653.07 for a surviving spouse, with additional amounts for children, aid and attendance, transition benefits for the first two years, and being married to your deceased veteran for eight years while the veteran was 100% disabled. For the first two years, a surviving spouse requiring aid and attendance who qualifies for the eight-year provision, with two children under age 18, would receive $3,582.68 per month, based on 2025 rates.

Learn more about VA indemnity and dependency compensation.

When will they pay you?

Now that you have an idea of how much you will receive, write down your 2025 paydays:

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