Don't 'bank' on COLA

  • Published
  • By Airman 1st Class Ciara M. Travis
  • 86th Airlift Wing Public Affairs
Living overseas can be expensive. However, things like the Cost of Living Allowance, or COLA, are designed to help offset expenses occurred from the local economy. But officials stress that Airmen should not view COLA as a reliable source of income, and encourage them to save it where possible for times of spikes in the exchange rate or emergency needs.

"My advice is to plan everything on your base pay," said Staff Sgt. Heather Borland, 86th Airlift Wing Comptroller Squadron, noncommissioned officer in charge. "You should use your Overseas Housing Allowance on your home, your Basic Allowance for Subsistence on food, and then COLA should just be extra."

The exchange rates are evaluated at least twice per month to ensure they are kept up to date with the local area currency.

COLA payments are based on the member's regular military compensation and their spendable income. This includes basic pay, BAS, and the results derived from a living pattern survey taken every three years. The last living pattern survey in U.S. Air Forces in Europe was conducted in 2009.

When COLA is used as an amenity to the rest of the paycheck, it can be used for things like saving money or traveling.

"I've even heard of people saving their COLA, as if they aren't even receiving any-- and then leaving with a substantially larger savings account," said Sergeant Borland.

For some, COLA is a necessary part of their paycheck -- using every last bit of their check for things like traveling, shopping off-base or even monthly bills.

"Some people forget that COLA is extra," said Anna Bennett, Airman and Family Readiness Center Air Force Aid officer.

Ms. Bennett even suggests that when COLA is saved as an extra, it can be used for unexpected expenses, she said.

"With the right budgeting, a lot of financial stress can be lifted," said Ms. Bennet.

Those seeking assistance in budgeting their finances should contact their localĀ Airman and Family Readiness Center.