Description of Proposed Provision:
B3.12: Use an annualized "mini-PIA" formula beginning with retired workers newly eligible in 2024. For each indexed earnings year, compute an individual AIME and an individual PIA. Sum these individual PIAs for the 40 highest years of indexed earnings and divide that total amount by 37 to get the PIA for this provision. Phase-in over five years, meaning that in 2024, 80 percent of the benefit would be based on the old 35-year average PIA formula and 20 percent on the new mini-PIA formula, shifting by 20 percentage points each year until 100 percent is based on the new mini-PIA formula for those attaining age 62 in 2028. Disabled worker benefits are unchanged under this provision.
Financial Estimates for the OASDI Trust Fund Program
| Proposal | Change from Current Law | ||||||||
|---|---|---|---|---|---|---|---|---|---|
|
Expressed as a percentage of current-law taxable payroll |
Trust fund ratio as of January 1 |
Expressed as a percentage of current-law taxable payroll |
|||||||
|
Calendar year |
Cost rate |
Income rate |
Annual balance |
Cost rate |
Income rate |
Annual balance |
|||
| 2017 | 13.41 | 13.03 | -0.38 | 298 | 0.00 | 0.00 | 0.00 | ||
| 2018 | 13.49 | 12.93 | -0.56 | 287 | 0.00 | 0.00 | 0.00 | ||
| 2019 | 13.70 | 12.95 | -0.75 | 273 | 0.00 | 0.00 | 0.00 | ||
| 2020 | 13.85 | 12.96 | -0.89 | 259 | 0.00 | 0.00 | 0.00 | ||
| 2021 | 14.02 | 12.99 | -1.03 | 245 | 0.00 | 0.00 | 0.00 | ||
| 2022 | 14.26 | 13.02 | -1.23 | 230 | 0.00 | 0.00 | 0.00 | ||
| 2023 | 14.54 | 13.05 | -1.50 | 215 | 0.00 | 0.00 | 0.00 | ||
| 2024 | 14.83 | 13.08 | -1.74 | 199 | -0.00 | -0.00 | 0.00 | ||
| 2025 | 15.09 | 13.10 | -1.99 | 182 | -0.00 | -0.00 | 0.00 | ||
| 2026 | 15.36 | 13.13 | -2.23 | 165 | -0.01 | -0.00 | 0.01 | ||
| 2027 | 15.60 | 13.15 | -2.45 | 148 | -0.02 | -0.00 | 0.02 | ||
| 2028 | 15.82 | 13.17 | -2.65 | 131 | -0.03 | -0.00 | 0.03 | ||
| 2029 | 16.01 | 13.18 | -2.84 | 113 | -0.05 | -0.00 | 0.05 | ||
| 2030 | 16.20 | 13.19 | -3.01 | 95 | -0.07 | -0.00 | 0.07 | ||
| 2031 | 16.36 | 13.20 | -3.16 | 77 | -0.09 | -0.00 | 0.08 | ||
| 2032 | 16.50 | 13.21 | -3.29 | 58 | -0.11 | -0.01 | 0.10 | ||
| 2033 | 16.62 | 13.22 | -3.40 | 39 | -0.12 | -0.01 | 0.12 | ||
| 2034 | 16.71 | 13.23 | -3.48 | 19 | -0.14 | -0.01 | 0.13 | ||
| 2035 | 16.77 | 13.23 | -3.54 | ---- | -0.16 | -0.01 | 0.15 | ||
| 2036 | 16.81 | 13.23 | -3.58 | ---- | -0.18 | -0.01 | 0.17 | ||
| 2037 | 16.83 | 13.24 | -3.59 | ---- | -0.19 | -0.01 | 0.18 | ||
| 2038 | 16.82 | 13.24 | -3.58 | ---- | -0.20 | -0.01 | 0.19 | ||
| 2039 | 16.78 | 13.24 | -3.54 | ---- | -0.22 | -0.01 | 0.20 | ||
| 2040 | 16.73 | 13.23 | -3.50 | ---- | -0.23 | -0.01 | 0.21 | ||
| 2041 | 16.68 | 13.23 | -3.44 | ---- | -0.24 | -0.01 | 0.22 | ||
| 2042 | 16.61 | 13.23 | -3.38 | ---- | -0.25 | -0.01 | 0.23 | ||
| 2043 | 16.55 | 13.23 | -3.32 | ---- | -0.26 | -0.01 | 0.24 | ||
| 2044 | 16.49 | 13.22 | -3.27 | ---- | -0.27 | -0.02 | 0.25 | ||
| 2045 | 16.44 | 13.22 | -3.22 | ---- | -0.28 | -0.02 | 0.26 | ||
| 2046 | 16.39 | 13.22 | -3.17 | ---- | -0.29 | -0.02 | 0.27 | ||
| 2047 | 16.35 | 13.22 | -3.13 | ---- | -0.30 | -0.02 | 0.28 | ||
| 2048 | 16.31 | 13.22 | -3.09 | ---- | -0.31 | -0.02 | 0.29 | ||
| 2049 | 16.27 | 13.21 | -3.05 | ---- | -0.32 | -0.02 | 0.30 | ||
| 2050 | 16.24 | 13.21 | -3.02 | ---- | -0.33 | -0.02 | 0.31 | ||
| 2051 | 16.21 | 13.21 | -3.00 | ---- | -0.34 | -0.02 | 0.32 | ||
| 2052 | 16.21 | 13.21 | -2.99 | ---- | -0.35 | -0.02 | 0.33 | ||
| 2053 | 16.21 | 13.21 | -3.00 | ---- | -0.36 | -0.02 | 0.34 | ||
| 2054 | 16.22 | 13.21 | -3.01 | ---- | -0.37 | -0.02 | 0.35 | ||
| 2055 | 16.24 | 13.22 | -3.03 | ---- | -0.38 | -0.02 | 0.35 | ||
| 2056 | 16.27 | 13.22 | -3.05 | ---- | -0.38 | -0.02 | 0.36 | ||
| 2057 | 16.31 | 13.22 | -3.08 | ---- | -0.39 | -0.02 | 0.37 | ||
| 2058 | 16.34 | 13.22 | -3.12 | ---- | -0.40 | -0.02 | 0.37 | ||
| 2059 | 16.38 | 13.23 | -3.15 | ---- | -0.40 | -0.02 | 0.38 | ||
| 2060 | 16.42 | 13.23 | -3.19 | ---- | -0.41 | -0.02 | 0.38 | ||
| 2061 | 16.46 | 13.23 | -3.23 | ---- | -0.41 | -0.02 | 0.39 | ||
| 2062 | 16.51 | 13.24 | -3.27 | ---- | -0.41 | -0.02 | 0.39 | ||
| 2063 | 16.55 | 13.24 | -3.31 | ---- | -0.42 | -0.02 | 0.39 | ||
| 2064 | 16.60 | 13.24 | -3.36 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2065 | 16.64 | 13.24 | -3.40 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2066 | 16.69 | 13.25 | -3.45 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2067 | 16.74 | 13.25 | -3.49 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2068 | 16.80 | 13.25 | -3.54 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2069 | 16.85 | 13.26 | -3.59 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2070 | 16.90 | 13.26 | -3.64 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2071 | 16.94 | 13.26 | -3.68 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2072 | 16.98 | 13.27 | -3.72 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2073 | 17.02 | 13.27 | -3.75 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2074 | 17.05 | 13.27 | -3.78 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2075 | 17.07 | 13.27 | -3.80 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2076 | 17.09 | 13.27 | -3.81 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2077 | 17.09 | 13.27 | -3.82 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2078 | 17.09 | 13.27 | -3.82 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2079 | 17.09 | 13.27 | -3.81 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2080 | 17.08 | 13.27 | -3.81 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2081 | 17.08 | 13.27 | -3.81 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2082 | 17.08 | 13.27 | -3.81 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2083 | 17.09 | 13.27 | -3.82 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2084 | 17.10 | 13.27 | -3.83 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2085 | 17.13 | 13.28 | -3.85 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2086 | 17.16 | 13.28 | -3.88 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2087 | 17.19 | 13.28 | -3.91 | ---- | -0.42 | -0.02 | 0.40 | ||
| 2088 | 17.23 | 13.28 | -3.95 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2089 | 17.27 | 13.28 | -3.99 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2090 | 17.32 | 13.29 | -4.03 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2091 | 17.37 | 13.29 | -4.08 | ---- | -0.43 | -0.02 | 0.40 | ||
| 2092 | 17.41 | 13.29 | -4.12 | ---- | -0.43 | -0.02 | 0.41 | ||
Summarized Estimates
| Proposal | Change from Current Law | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Years | Cost rate |
Income rate |
Actuarial balance |
Year of reserve depletion1 |
Cost rate |
Income rate |
Actuarial balance |
||
| 2017-2091 | 16.40% | 13.82% | -2.58% | 2034 | -0.27% | -0.01% | 0.25% | ||
1 Under current law, the year of Trust Fund reserve depletion is 2034. |
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Based on Intermediate Assumptions of the 2017 Trustees Report.