Summary Measures and Graphs
Description of Proposed Provision:
B3.16: For retired worker and disabled worker beneficiaries becoming initially eligible in January 2031 or later, phase in a new benefit formula (from 2031 to 2040). Replace the existing two primary insurance amount (PIA) bend points with three new bend points as follows: (1) 25% AWI/12 from 2 years prior to initial eligibility; (2) 100% AWI/12 from 2 years prior to initial eligibility; and (3) 125% AWI/12 from 2 years prior to initial eligibility. The new PIA factors are 95%, 27.5%, 5% and 2%. During the phase in, those becoming newly eligible for benefits will receive an increasing portion of their benefits based on the new formula, reaching 100% of the new formula in 2040.
Estimates based on the intermediate assumptions
of the 2024 Trustees Report
Summary Measures | |||||||
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Current law [percent of payroll] |
Change from current law [percent of payroll] |
Shortfall eliminated | |||||
Long-range actuarial balance |
Annual balance in 75th year |
Long-range actuarial balance |
Annual balance in 75th year |
Long-range actuarial balance |
Annual balance in 75th year |
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-3.50 | -4.64 | 1.00 | 1.75 | 28% | 38% |