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| Actuarial Publications |
Summary of Provisions That Would Change the Social Security Program |
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Description of Proposed Provisions:
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Estimates based on the intermediate assumptions of the 2012 Trustees Report
| Printer-friendly Version (PDF) |
| Change from present law | Results with this provision | |||||
|---|---|---|---|---|---|---|
| Long-range actuarial balance |
Annual balance in 75th year |
Long-range actuarial balance |
Annual balance in 75th year |
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| Present Law, Alternative II. |
-2.67 | -4.50 | ||||
| C1.1 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022,
increase the NRA 1 month every 2 years until the NRA reaches 68.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.32 | 0.72 | -2.34 | -3.78 | |
| C1.2 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022,
increase the NRA 2 months every year until the NRA reaches 68.
graph | table | pdf-graph | pdf-table | memo (Liebman, MacGuineas, Samwick) |
0.42 | 0.72 | -2.25 | -3.78 | |
| C1.3 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022,
index the NRA to maintain a constant ratio of expected retirement years
(life expectancy at NRA) to potential work years (NRA minus 20). We assume
the NRA will increase 1 month every 2 years.
graph | table | pdf-graph | pdf-table | memo (Ryan 2010) | memo (AARP) | memo (Ryan 2008) | memo (Social Security Advisory Board) |
0.45 | 1.56 | -2.21 | -2.95 | |
| C1.4 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022,
increase the NRA 2 months per year until it reaches 69 for individuals
attaining age 62 in 2034. Thereafter, increase the NRA 1 month every 2 years.
graph | table | pdf-graph | pdf-table | memo (Chaffetz) |
1.00 | 2.42 | -1.67 | -2.08 | |
| C1.5 |
Starting in 2013, allow workers to choose whether to have their payroll tax rate
reduced by 2 percentage points. For each calendar year that a worker chooses to
have their payroll tax reduced, their NRA increases 1 month. We assume 2/3 of
workers each year will choose this payroll reduction. The General Fund of the
Treasury reimburses the OASI and DI Trust Funds for the reduction in payroll
tax revenue.
graph | table | pdf-graph | pdf-table | memo (Landry) |
0.65 | 1.50 | -2.01 | -3.01 | |
| C2.1 |
Increase the earliest eligibility age (EEA) by two months every year for those
age 62 starting in 2014 and ending in 2031 (EEA reaches 65 for those age 62 in 2031).
graph | table | pdf-graph | pdf-table | memo (AARP) |
-0.07 | -0.44 | -2.73 | -4.94 | |
| C2.2 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022, index the NRA
to maintain a constant ratio of expected retirement years (life expectancy at NRA) to
potential work years (NRA minus 20). We assume the NRA will increase 1 month every 2 years.
Also, raise the earliest eligibility age (EEA) for retired-workers, aged widow(er)s, and
disabled widow(er)s by the same amount as the NRA starting for those attaining EEA in 2017.
graph | table | pdf-graph | pdf-table | memo (NRC/NAPA) | memo (Warshawsky) |
0.48 | 1.49 | -2.18 | -3.02 | |
| C2.3 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022, index the
NRA to maintain a constant ratio of expected retirement years (life expectancy at NRA)
to potential work years (NRA minus 20). We assume the NRA will increase 1 month every 2
years. Also, increase the earliest eligibility age (EEA) by the same amount as the NRA
starting for those age 62 in 2022 so as to maintain a 5 year difference between the two
ages. Include a "hardship exemption" with no EEA/NRA change for a worker with 25 years of
earnings (with 4 quarters of coverage each), and average indexed monthly earnings (AIME)
less than 250 percent of the poverty level (wage-indexed from 2011). The hardship exemption
is phased out for those with AIME above 400 percent of the poverty level.
graph | table | pdf-graph | pdf-table | memo (Fiscal Commission) |
0.38 | 1.24 | -2.29 | -3.27 | |
| C2.4 |
After the normal retirement age (NRA) reaches 67 for those age 62 in 2022, increase
both the NRA and the earliest eligibility age (EEA) by 36/47 of a month per year until
the NRA and EEA reach 65 and 70 respectively. For each year, the computed EEA and NRA
rounds down to the next lower full month.
graph | table | pdf-graph | pdf-table | memo (Lummis) |
0.67 | 2.01 | -2.00 | -2.49 | |
| C2.5 |
Increase the normal retirement age (NRA) 3 months per year starting for those
age 62 in 2017 until the NRA reaches 70 in 2032. Thereafter, index the NRA to
maintain a constant ratio of expected retirement years (life expectancy at NRA)
to potential work years (NRA minus 20). We assume the NRA will increase 1 month
every 2 years. Also, increase the earliest eligibility age (EEA) from 62 to 64
at the same time the NRA increases from 67 to 69; that is, for those attaining
age 62 in 2021 through 2028. Keep EEA at 64 thereafter.
graph | table | pdf-graph | pdf-table | memo (Graham, Paul, Lee) |
1.40 | 2.87 | -1.27 | -1.63 | |
| C2.6 |
Increase the normal retirement age (NRA) and the earliest eligibility age (EEA)
for those age 62 in 2020-21 to 68 and 63, respectively and then by 3 months per
year in 2022-25 to 69 and 64, respectively.
graph | table | pdf-graph | pdf-table | memo (Hutchison) |
0.89 | 1.22 | -1.77 | -3.28 | |
| C2.7 |
Increase the normal retirement age (NRA) and the earliest eligibility age (EEA)
for those age 62 starting in 2016 by 3 months per year until EEA reaches 64 in
2023 and NRA reaches 69 in 2027.
graph | table | pdf-graph | pdf-table | memo (Hutchison) |
0.86 | 1.22 | -1.81 | -3.28 | |
| C2.8 |
Starting in 2015, convert all disabled-worker beneficiaries to retired-worker status
upon attainment of their earliest eligibility age (EEA) rather than their normal
retirement age (NRA). After conversion, apply the early retirement reduction for
retirement at EEA (currently 25 percent for those age 62 in 2014) phased in over 40
years.
graph | table | pdf-graph | pdf-table | memo (Warshawsky) |
0.40 | 0.80 | -2.26 | -3.70 | |
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