Description of Proposed Provision:
B1.3: Progressive price indexing (40th percentile) of PIA factors beginning with individuals newly eligible for OASDI benefits in 2025: 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.
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 | -1.97 | 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 | -2.20 | 137 | -0.01 | -0.00 | 0.01 | ||
| 2028 | 15.57 | 13.17 | -2.40 | 121 | -0.01 | -0.00 | 0.01 | ||
| 2029 | 15.77 | 13.19 | -2.58 | 104 | -0.02 | -0.00 | 0.02 | ||
| 2030 | 15.95 | 13.20 | -2.75 | 87 | -0.04 | -0.00 | 0.03 | ||
| 2031 | 16.11 | 13.21 | -2.89 | 70 | -0.05 | -0.00 | 0.05 | ||
| 2032 | 16.24 | 13.22 | -3.02 | 52 | -0.08 | -0.00 | 0.07 | ||
| 2033 | 16.35 | 13.23 | -3.12 | 34 | -0.10 | -0.01 | 0.10 | ||
| 2034 | 16.43 | 13.24 | -3.19 | 16 | -0.14 | -0.01 | 0.13 | ||
| 2035 | 16.48 | 13.25 | -3.23 | ---- | -0.17 | -0.01 | 0.16 | ||
| 2036 | 16.51 | 13.25 | -3.26 | ---- | -0.21 | -0.01 | 0.20 | ||
| 2037 | 16.52 | 13.25 | -3.27 | ---- | -0.26 | -0.01 | 0.25 | ||
| 2038 | 16.51 | 13.25 | -3.26 | ---- | -0.31 | -0.02 | 0.29 | ||
| 2039 | 16.47 | 13.25 | -3.22 | ---- | -0.36 | -0.02 | 0.34 | ||
| 2040 | 16.42 | 13.25 | -3.17 | ---- | -0.41 | -0.02 | 0.39 | ||
| 2041 | 16.34 | 13.25 | -3.10 | ---- | -0.47 | -0.02 | 0.44 | ||
| 2042 | 16.25 | 13.24 | -3.01 | ---- | -0.52 | -0.03 | 0.49 | ||
| 2043 | 16.15 | 13.24 | -2.91 | ---- | -0.58 | -0.03 | 0.55 | ||
| 2044 | 16.05 | 13.23 | -2.82 | ---- | -0.64 | -0.03 | 0.61 | ||
| 2045 | 15.95 | 13.23 | -2.72 | ---- | -0.71 | -0.04 | 0.67 | ||
| 2046 | 15.85 | 13.23 | -2.63 | ---- | -0.77 | -0.04 | 0.73 | ||
| 2047 | 15.76 | 13.22 | -2.54 | ---- | -0.84 | -0.05 | 0.80 | ||
| 2048 | 15.66 | 13.22 | -2.45 | ---- | -0.91 | -0.05 | 0.86 | ||
| 2049 | 15.57 | 13.21 | -2.36 | ---- | -0.98 | -0.05 | 0.93 | ||
| 2050 | 15.48 | 13.21 | -2.28 | ---- | -1.06 | -0.06 | 1.00 | ||
| 2051 | 15.40 | 13.21 | -2.20 | ---- | -1.13 | -0.06 | 1.07 | ||
| 2052 | 15.33 | 13.20 | -2.12 | ---- | -1.21 | -0.07 | 1.14 | ||
| 2053 | 15.26 | 13.20 | -2.06 | ---- | -1.28 | -0.07 | 1.21 | ||
| 2054 | 15.20 | 13.20 | -2.00 | ---- | -1.36 | -0.08 | 1.29 | ||
| 2055 | 15.15 | 13.19 | -1.95 | ---- | -1.44 | -0.08 | 1.36 | ||
| 2056 | 15.10 | 13.19 | -1.91 | ---- | -1.52 | -0.09 | 1.43 | ||
| 2057 | 15.06 | 13.19 | -1.87 | ---- | -1.60 | -0.09 | 1.51 | ||
| 2058 | 15.03 | 13.19 | -1.84 | ---- | -1.68 | -0.10 | 1.59 | ||
| 2059 | 15.00 | 13.19 | -1.81 | ---- | -1.76 | -0.10 | 1.66 | ||
| 2060 | 14.97 | 13.19 | -1.78 | ---- | -1.84 | -0.10 | 1.73 | ||
| 2061 | 14.94 | 13.19 | -1.75 | ---- | -1.92 | -0.11 | 1.81 | ||
| 2062 | 14.92 | 13.19 | -1.73 | ---- | -1.99 | -0.11 | 1.88 | ||
| 2063 | 14.89 | 13.19 | -1.70 | ---- | -2.07 | -0.12 | 1.95 | ||
| 2064 | 14.87 | 13.19 | -1.68 | ---- | -2.15 | -0.12 | 2.02 | ||
| 2065 | 14.85 | 13.19 | -1.66 | ---- | -2.22 | -0.13 | 2.09 | ||
| 2066 | 14.83 | 13.19 | -1.64 | ---- | -2.30 | -0.13 | 2.16 | ||
| 2067 | 14.81 | 13.19 | -1.63 | ---- | -2.37 | -0.14 | 2.23 | ||
| 2068 | 14.80 | 13.19 | -1.61 | ---- | -2.45 | -0.14 | 2.30 | ||
| 2069 | 14.78 | 13.19 | -1.60 | ---- | -2.52 | -0.15 | 2.37 | ||
| 2070 | 14.77 | 13.19 | -1.58 | ---- | -2.59 | -0.15 | 2.44 | ||
| 2071 | 14.75 | 13.18 | -1.57 | ---- | -2.67 | -0.15 | 2.51 | ||
| 2072 | 14.73 | 13.18 | -1.55 | ---- | -2.74 | -0.16 | 2.58 | ||
| 2073 | 14.70 | 13.18 | -1.52 | ---- | -2.81 | -0.16 | 2.65 | ||
| 2074 | 14.68 | 13.18 | -1.49 | ---- | -2.88 | -0.17 | 2.71 | ||
| 2075 | 14.64 | 13.18 | -1.46 | ---- | -2.94 | -0.17 | 2.77 | ||
| 2076 | 14.60 | 13.18 | -1.42 | ---- | -3.01 | -0.18 | 2.83 | ||
| 2077 | 14.55 | 13.18 | -1.38 | ---- | -3.07 | -0.18 | 2.89 | ||
| 2078 | 14.50 | 13.17 | -1.32 | ---- | -3.13 | -0.18 | 2.95 | ||
| 2079 | 14.43 | 13.17 | -1.26 | ---- | -3.18 | -0.19 | 3.00 | ||
| 2080 | 14.37 | 13.17 | -1.20 | ---- | -3.24 | -0.19 | 3.05 | ||
| 2081 | 14.30 | 13.16 | -1.14 | ---- | -3.29 | -0.19 | 3.10 | ||
| 2082 | 14.23 | 13.16 | -1.07 | ---- | -3.34 | -0.19 | 3.15 | ||
| 2083 | 14.16 | 13.15 | -1.01 | ---- | -3.39 | -0.20 | 3.19 | ||
| 2084 | 14.10 | 13.15 | -0.95 | ---- | -3.44 | -0.20 | 3.24 | ||
| 2085 | 14.04 | 13.15 | -0.89 | ---- | -3.49 | -0.20 | 3.29 | ||
| 2086 | 13.98 | 13.14 | -0.84 | ---- | -3.54 | -0.21 | 3.34 | ||
| 2087 | 13.94 | 13.14 | -0.80 | ---- | -3.60 | -0.21 | 3.39 | ||
| 2088 | 13.90 | 13.14 | -0.76 | ---- | -3.65 | -0.21 | 3.44 | ||
| 2089 | 13.87 | 13.14 | -0.73 | ---- | -3.70 | -0.22 | 3.49 | ||
| 2090 | 13.84 | 13.14 | -0.71 | ---- | -3.75 | -0.22 | 3.54 | ||
| 2091 | 13.83 | 13.13 | -0.69 | ---- | -3.81 | -0.22 | 3.58 | ||
| 2092 | 13.82 | 13.13 | -0.68 | ---- | -3.86 | -0.23 | 3.63 | ||
| 2093 | 13.82 | 13.13 | -0.68 | ---- | -3.91 | -0.23 | 3.68 | ||
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 | 15.31% | 13.77% | -1.54% | 2034 | -1.38% | -0.08% | 1.30% | ||
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.