The Overseas Cost of Living Allowance is a supplement designed to equalize purchasing power between members overseas and their CONUS-based counterparts. The following is a summary of the Overseas Cost of Living Allowance:
How Much Is Overseas COLA?
The average supplement is $300 per month. The basic measurement is a comparison of the difference in average costs related to purchasing essentials in CONUS and at the OCONUS location. It impacts 320,000 members at approximately 600 locations overseas, including Alaska and Hawaii. The current cost is approx. $1 billion annually.
There are surveys done annually to determine the costs of goods such as groceries, services, fuel and other necessities of life. The COLA is based on the difference between CONUS and OCONUS prices.
COLA can also change on based on fluctuations in the currency conversion rate.
The COLA index is highly dependent on the proportion of shopping done in on-base facilities. In general, the higher the proportion of on-base shopping, the lower the index. Therefore a smaller base with less exchange and commissary facilities may have a higher COLA than a base in the same country with better on-base shopping facilities.
How can I determine my Overseas COLA?
The COLA payment depends on your pay grade, the number of command-sponsored dependents you are authorized, your location and if you live shipboard or in the barracks. The amount can change every pay period depending on local conditions or financial conditions.
The Defense Travel Management Office has an online COLA calculator to help you determine what your COLA rate will be. Visit it here.
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