Description of Proposed Provision:
B1.7: Progressive price indexing (40th percentile) of PIA factors for individuals newly eligible for OASI benefits in 2026 through 2063: Create a new bend point at the 40th percentile of the AIME distribution of newly retired workers. Maintain current-law benefits for earners at the 40th percentile and below. Reduce the 32 and 15 percent factors above the 40th percentile such that the initial benefit for a worker with AIME equal to the taxable maximum grows by inflation rather than the growth in the SSA average wage index. Disabled workers are: (a) not affected prior to normal retirement age; and (b) subject to a proportional reduction in benefits, based on the worker's years of disability, upon conversion to retired-worker beneficiary status. Young survivors (children of deceased workers and surviving spouses with a child in care) are not affected.
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 |
|||
| 2018 | 13.81 | 12.64 | -1.17 | 288 | 0.00 | 0.00 | 0.00 | ||
| 2019 | 13.95 | 12.87 | -1.08 | 272 | 0.00 | 0.00 | 0.00 | ||
| 2020 | 14.12 | 12.89 | -1.23 | 256 | 0.00 | 0.00 | 0.00 | ||
| 2021 | 14.27 | 12.92 | -1.35 | 239 | 0.00 | 0.00 | 0.00 | ||
| 2022 | 14.44 | 12.95 | -1.49 | 223 | 0.00 | 0.00 | 0.00 | ||
| 2023 | 14.62 | 12.97 | -1.66 | 206 | 0.00 | 0.00 | 0.00 | ||
| 2024 | 14.80 | 12.99 | -1.81 | 188 | 0.00 | 0.00 | 0.00 | ||
| 2025 | 14.98 | 13.01 | -1.98 | 171 | 0.00 | 0.00 | 0.00 | ||
| 2026 | 15.16 | 13.13 | -2.02 | 154 | -0.00 | -0.00 | 0.00 | ||
| 2027 | 15.36 | 13.15 | -2.21 | 137 | -0.00 | -0.00 | 0.00 | ||
| 2028 | 15.58 | 13.17 | -2.41 | 120 | -0.00 | -0.00 | 0.00 | ||
| 2029 | 15.78 | 13.19 | -2.60 | 104 | -0.01 | -0.00 | 0.01 | ||
| 2030 | 15.97 | 13.20 | -2.77 | 87 | -0.01 | -0.00 | 0.01 | ||
| 2031 | 16.14 | 13.21 | -2.92 | 69 | -0.02 | -0.00 | 0.02 | ||
| 2032 | 16.28 | 13.23 | -3.06 | 52 | -0.03 | -0.00 | 0.03 | ||
| 2033 | 16.40 | 13.23 | -3.17 | 34 | -0.05 | -0.00 | 0.05 | ||
| 2034 | 16.49 | 13.24 | -3.25 | 15 | -0.07 | -0.00 | 0.07 | ||
| 2035 | 16.55 | 13.25 | -3.31 | ---- | -0.10 | -0.01 | 0.09 | ||
| 2036 | 16.60 | 13.25 | -3.34 | ---- | -0.13 | -0.01 | 0.12 | ||
| 2037 | 16.62 | 13.26 | -3.37 | ---- | -0.16 | -0.01 | 0.15 | ||
| 2038 | 16.63 | 13.26 | -3.37 | ---- | -0.20 | -0.01 | 0.18 | ||
| 2039 | 16.60 | 13.26 | -3.34 | ---- | -0.23 | -0.01 | 0.22 | ||
| 2040 | 16.55 | 13.26 | -3.30 | ---- | -0.27 | -0.02 | 0.26 | ||
| 2041 | 16.49 | 13.25 | -3.24 | ---- | -0.32 | -0.02 | 0.30 | ||
| 2042 | 16.41 | 13.25 | -3.16 | ---- | -0.36 | -0.02 | 0.34 | ||
| 2043 | 16.32 | 13.25 | -3.07 | ---- | -0.41 | -0.02 | 0.39 | ||
| 2044 | 16.23 | 13.24 | -2.99 | ---- | -0.46 | -0.03 | 0.44 | ||
| 2045 | 16.14 | 13.24 | -2.90 | ---- | -0.52 | -0.03 | 0.49 | ||
| 2046 | 16.05 | 13.23 | -2.82 | ---- | -0.57 | -0.03 | 0.54 | ||
| 2047 | 15.97 | 13.23 | -2.74 | ---- | -0.63 | -0.04 | 0.59 | ||
| 2048 | 15.88 | 13.23 | -2.66 | ---- | -0.69 | -0.04 | 0.65 | ||
| 2049 | 15.80 | 13.22 | -2.58 | ---- | -0.75 | -0.04 | 0.71 | ||
| 2050 | 15.73 | 13.22 | -2.51 | ---- | -0.82 | -0.05 | 0.77 | ||
| 2051 | 15.65 | 13.22 | -2.44 | ---- | -0.88 | -0.05 | 0.83 | ||
| 2052 | 15.59 | 13.21 | -2.37 | ---- | -0.95 | -0.06 | 0.89 | ||
| 2053 | 15.53 | 13.21 | -2.32 | ---- | -1.02 | -0.06 | 0.95 | ||
| 2054 | 15.48 | 13.21 | -2.27 | ---- | -1.08 | -0.06 | 1.02 | ||
| 2055 | 15.44 | 13.21 | -2.23 | ---- | -1.15 | -0.07 | 1.09 | ||
| 2056 | 15.40 | 13.21 | -2.19 | ---- | -1.23 | -0.07 | 1.15 | ||
| 2057 | 15.37 | 13.20 | -2.16 | ---- | -1.30 | -0.08 | 1.22 | ||
| 2058 | 15.34 | 13.20 | -2.14 | ---- | -1.37 | -0.08 | 1.29 | ||
| 2059 | 15.32 | 13.20 | -2.11 | ---- | -1.44 | -0.09 | 1.36 | ||
| 2060 | 15.29 | 13.20 | -2.09 | ---- | -1.52 | -0.09 | 1.42 | ||
| 2061 | 15.27 | 13.20 | -2.07 | ---- | -1.59 | -0.10 | 1.49 | ||
| 2062 | 15.25 | 13.20 | -2.05 | ---- | -1.66 | -0.10 | 1.56 | ||
| 2063 | 15.24 | 13.20 | -2.03 | ---- | -1.73 | -0.10 | 1.62 | ||
| 2064 | 15.22 | 13.20 | -2.02 | ---- | -1.80 | -0.11 | 1.69 | ||
| 2065 | 15.20 | 13.20 | -2.00 | ---- | -1.86 | -0.11 | 1.75 | ||
| 2066 | 15.19 | 13.20 | -1.99 | ---- | -1.93 | -0.12 | 1.82 | ||
| 2067 | 15.18 | 13.20 | -1.98 | ---- | -2.00 | -0.12 | 1.88 | ||
| 2068 | 15.18 | 13.20 | -1.97 | ---- | -2.07 | -0.13 | 1.94 | ||
| 2069 | 15.17 | 13.20 | -1.97 | ---- | -2.13 | -0.13 | 2.00 | ||
| 2070 | 15.17 | 13.20 | -1.97 | ---- | -2.19 | -0.13 | 2.06 | ||
| 2071 | 15.17 | 13.20 | -1.96 | ---- | -2.25 | -0.14 | 2.12 | ||
| 2072 | 15.16 | 13.20 | -1.96 | ---- | -2.31 | -0.14 | 2.17 | ||
| 2073 | 15.15 | 13.20 | -1.95 | ---- | -2.36 | -0.14 | 2.22 | ||
| 2074 | 15.14 | 13.20 | -1.94 | ---- | -2.41 | -0.15 | 2.26 | ||
| 2075 | 15.13 | 13.20 | -1.93 | ---- | -2.46 | -0.15 | 2.31 | ||
| 2076 | 15.11 | 13.20 | -1.91 | ---- | -2.50 | -0.15 | 2.35 | ||
| 2077 | 15.09 | 13.20 | -1.89 | ---- | -2.54 | -0.15 | 2.38 | ||
| 2078 | 15.06 | 13.20 | -1.86 | ---- | -2.57 | -0.16 | 2.41 | ||
| 2079 | 15.02 | 13.20 | -1.83 | ---- | -2.60 | -0.16 | 2.44 | ||
| 2080 | 14.99 | 13.20 | -1.79 | ---- | -2.62 | -0.16 | 2.46 | ||
| 2081 | 14.95 | 13.19 | -1.76 | ---- | -2.64 | -0.16 | 2.48 | ||
| 2082 | 14.91 | 13.19 | -1.72 | ---- | -2.66 | -0.16 | 2.50 | ||
| 2083 | 14.88 | 13.19 | -1.69 | ---- | -2.68 | -0.16 | 2.51 | ||
| 2084 | 14.85 | 13.19 | -1.66 | ---- | -2.69 | -0.16 | 2.53 | ||
| 2085 | 14.83 | 13.19 | -1.64 | ---- | -2.70 | -0.17 | 2.54 | ||
| 2086 | 14.81 | 13.18 | -1.63 | ---- | -2.72 | -0.17 | 2.55 | ||
| 2087 | 14.80 | 13.18 | -1.62 | ---- | -2.73 | -0.17 | 2.56 | ||
| 2088 | 14.81 | 13.18 | -1.62 | ---- | -2.74 | -0.17 | 2.57 | ||
| 2089 | 14.81 | 13.18 | -1.63 | ---- | -2.75 | -0.17 | 2.59 | ||
| 2090 | 14.83 | 13.19 | -1.65 | ---- | -2.77 | -0.17 | 2.60 | ||
| 2091 | 14.86 | 13.19 | -1.67 | ---- | -2.78 | -0.17 | 2.61 | ||
| 2092 | 14.89 | 13.19 | -1.70 | ---- | -2.79 | -0.17 | 2.62 | ||
| 2093 | 14.92 | 13.19 | -1.73 | ---- | -2.81 | -0.17 | 2.63 | ||
Summarized Estimates
| Proposal | Change from Current Law | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Years | Cost rate |
Income rate |
Actuarial balance |
Year of reserve depletion1 |
Cost rate |
Income rate |
Actuarial balance |
||
| 2018-2092 | 15.60% | 13.78% | -1.82% | 2034 | -1.09% | -0.06% | 1.02% | ||
1 Under current law, the year of Trust Fund reserve depletion is 2034. |
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Based on Intermediate Assumptions of the 2018 Trustees Report.