Cost of Living Adjustment (“COLA”) refers to when child support is increased based on the annual cost of living. If the cost of living, pursuant to the Consumers Price Index for all urban consumers (CPI-U), as published annually by the United States Department of Labor Statistics, increases by at least 10% then an adjustment may be made.
It is important to have an attorney seasoned in the area of child support because, at first look asking for a COLA may seem like a “slam dunk” for the custodial parent; however, asking for a COLA is not always in the best financial interest of the custodial parent because it may open the issue up for the court to review child support de novo (from the beginning) and then take the chance that the court might or might not decrease the child support. In other words, from a strategic standpoint, if the custodial parent believes that the non-custodial parent’s income has increased in the past two year more than 10%, the custodial parent might be better off requesting the COLA hearing, but then objecting to the inflation adjustment, and then seek a de novo guidelines calculation. From the other side, the non-custodial parent, if presented with a cost of living increase, should consider an objection only if he or she believes that application of the guidelines would result in a lesser payment than the inflation adjustment would entail. Since there are risks associated with seeking a COLA, a family law attorney can help you understand what would be the best way for you to ensure your financial stability and serve the best interest of your child.