Summary Measures and Graphs

Trust Fund Investment in Equities	Description of Proposed Provision: G2: Invest 40 percent of the OASDI Trust Fund reserves in equities (phased in 2017-2031), assuming an ultimate 5.2 percent annual real rate of return on equities.

Estimates based on the intermediate assumptions of the 2016 Trustees Report

Summary Measures
Present law [percent of payroll]		Change from present 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
-2.66	-4.35	0.39*	0.00	*	0%

graph of OASDI cost rates and income rates by year, under
present law and provision. click on graph to view underlying
data.

graph of OASDI trust fund ratio by year, under present law
and provision. click on graph to view underlying data.

* A change in the investment of trust fund reserves to include some equities affects the size of all summarized measures because increased "present-value" discounting reduces the weight on values for more distant future years. As a result, the magnitude of the present-law actuarial balance and the summarized effects of most proposals is reduced. Therefore, the size of the change in the long-range actuarial balance indicated here cannot be interpreted directly as a reduction in the shortfall. The actual reduction in the shortfall from equity investment depends on the amount of reserves that are available for investment throughout the period. For example, if provisions to change revenue or scheduled benefits resulted in a purely pay-as-you-go system (reserves just above zero throughout the period), then investment in equities would have no effect on the actuarial balance.


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Summary Measures and Graphs

Description of Proposed Provision: G2: Invest 40 percent of the OASDI Trust Fund reserves in equities (phased in 2017-2031), assuming an ultimate 5.2 percent annual real rate of return on equities.

Description of Proposed Provision:
G2: Invest 40 percent of the OASDI Trust Fund reserves in equities (phased in 2017-2031), assuming an ultimate 5.2 percent annual real rate of return on equities.