Cost of Living Adjustment (COLA)
An automatic increase in child support or alimony payments based on inflation or changes in the cost of living, sometimes built into the original court order.
Understanding Cost of Living Adjustment (COLA)
A COLA clause automatically adjusts support payments annually based on a specified index, usually the Consumer Price Index (CPI). This eliminates the need to go back to court for modifications as inflation erodes the purchasing power of fixed payments. Not all states allow or require COLA clauses, and they may need to be specifically requested. Without a COLA provision, the recipient must petition for a modification and demonstrate changed circumstances to get a support increase.
Real-World Examples
The divorce decree includes a COLA clause increasing child support by 2.5% annually to keep pace with inflation.
Related Terms
Court-ordered payments from one parent to the other for the financial care of their children after divorce or separation.
AlimonyCourt-ordered financial support paid by one spouse to the other during or after divorce. Also called spousal support or maintenance.
ArrearageThe total amount of unpaid, overdue child support or alimony. Arrearage accumulates when a paying spouse falls behind on court-ordered payments.
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This definition is provided for educational purposes only and does not constitute legal advice. Divorce laws and terminology may vary by state and jurisdiction.
Always consult a licensed attorney in your area for advice specific to your situation.