Informational Articals - Cost of Living Increases

Cost of living increases are generally referred to as COLA, short for cost of living adjustment. Regardless of the name you know them as this is an increase in the cost of paying for basic living expenses in any given region. Knowing this information allows you to realistically determine if you can afford to move to a particular area. If you are trying to reduce your ongoing expenses you can search for areas that have a comparable income but a lower cost of living.

Many employers take a look at the cost of living index annually. They use this information to provide employees with a COLA to their earnings. They increase is often on a percentage or two but the fact that the employer takes the time and effort to offer it often means they are a good company to work for.

Most states determine their eligibility guidelines for various programs based on the cost of living increases. These programs include food stamps, Medicaid, and Medicare. As the cost of living goes up the amount of income a person can make in order to receive such benefits also increases.

The military is very liberal with COLA for those who are enlisted and have to live in an area with a very high cost of living. One of the most expensive areas in the United States to live is Alaska. However many military spouses find it can be a great opportunity for them financially. This happens when their spouse takes on a civilian job in Alaska at a very high rate of pay. Since the additional cost of their basic needs are covered by the military they are able to use most of that additional income as disposable income.

The different formulas that employers and the military use to calculate a COLA vary so it can be difficult to anticipate the amount of increase you will receive in any given year. It also depends on the budget of that particular business because in most instances a COLA is optional and not a requirement of the business. Unless they included a COLA to be dispersed annually when you were hired you are not entitled to receiving one.