CBO finds each active-duty soldier costs $86,000 more than budgeted

The Congressional Budget Office released a September 25 analysis indicating that the full governmental expense of an active-duty service member exceeds the Department of War’s budget by $86,000 per year. This gap represents future obligations to the Veterans Benefits Administration and Veterans Health Administration, which the CBO treats as deferred compensation linked to military service. With an authorized end strength of 1.3 million troops, the unaccounted cost amounts to about $112 billion each year, though it does not appear as a new line item in one outlet budget.

The CBO’s model follows the 2026 cohort of service members into retirement, projecting peak VA costs in the 2070s before tapering off by 2126. Median compensation for an enlisted E-4 rises from $129,000 to $215,000 when the accrual is added, while a median O-3 officer’s cost climbs from $196,000 to $282,000. Experts warn that Congress currently ignores these deferred VA costs in force-size decisions, a gap that could widen as VA spending continues to grow.