Plan 1--2-Earner Couple with Equal Earnings
Full Annuitization of Personal Account Assets at Retirement With a CPI-Indexed Life Annuity on a Joint and 2/3 Survivor Basis
No Basic Benefit Changes
|
PA Portfolio/Yield*
|
Scaled LOW Earner ($15,875 in 2002)
|
Scaled MEDIUM Earner ($35,277 in 2002)
|
Scaled HIGH Earner ($56,443 in 2002)
|
Scaled MAXIMUM Earner ($84,900 in 2002)
|
Low Yield
|
50% Equity
|
High Yield
|
Low Yield
|
50% Equity
|
High Yield
|
Low Yield
|
50% Equity
|
High Yield
|
Low Yield
|
50% Equity
|
High Yield
|
|
(Billions of Constant 2001 Dollars)
|
2012 Retiree
|
Present Law Scheduled Benefit
|
$723
|
$723
|
$723
|
$1,194
|
$1,194
|
$1,194
|
$1,578
|
$1,578
|
$1,578
|
$1,873
|
$1,873
|
$1,873
|
% Basic Change for All
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
% for PA Annuity**
|
1.8
|
2.0
|
2.0
|
2.4
|
2.7
|
2.7
|
2.9
|
3.3
|
3.3
|
4.6
|
5.1
|
5.1
|
% for Benefit Offset
|
-2.0
|
-2.0
|
-2.0
|
-2.7
|
-2.7
|
-2.7
|
-3.3
|
-3.3
|
-3.3
|
-5.1
|
-5.1
|
-5.1
|
Proposed Benefit
|
$722
|
$723
|
$723
|
$1,191
|
$1,194
|
$1,194
|
$1,572
|
$1,578
|
$1,578
|
$1,863
|
$1,873
|
$1,874
|
% of Present Law Scheduled Benefit
|
99.8
|
100.0
|
100.0
|
99.7
|
100.0
|
100.0
|
99.7
|
100.0
|
100.0
|
99.5
|
100.0
|
100.0
|
% of Present Law Payable Benefit
|
99.8
|
100.0
|
100.0
|
99.7
|
100.0
|
100.0
|
99.7
|
100.0
|
100.0
|
99.5
|
100.0
|
100.0
|
% of 2001 Real Benefit
|
113.3
|
113.5
|
113.6
|
113.2
|
113.5
|
113.6
|
115.1
|
115.5
|
115.6
|
121.1
|
121.8
|
121.9
|
2022 Retiree
|
Present Law Scheduled Benefit
|
$767
|
$767
|
$767
|
$1,266
|
$1,266
|
$1,266
|
$1,673
|
$1,673
|
$1,673
|
$2,024
|
$2,024
|
$2,024
|
% Basic Change for All
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
% for PA Annuity**
|
5.3
|
6.6
|
6.8
|
7.1
|
8.9
|
9.2
|
8.6
|
10.8
|
11.2
|
11.2
|
13.8
|
14.2
|
% for Benefit Offset
|
-6.2
|
-6.2
|
-6.2
|
-8.4
|
-8.4
|
-8.4
|
-10.1
|
-10.1
|
-10.1
|
-13.0
|
-13.0
|
-13.0
|
Proposed Benefit
|
$760
|
$770
|
$772
|
$1,250
|
$1,273
|
$1,277
|
$1,648
|
$1,684
|
$1,690
|
$1,986
|
$2,039
|
$2,048
|
% of Present Law Scheduled Benefit
|
99.1
|
100.4
|
100.6
|
98.8
|
100.5
|
100.8
|
98.5
|
100.7
|
101.0
|
98.1
|
100.7
|
101.2
|
% of Present Law Payable Benefit
|
99.1
|
100.4
|
100.6
|
98.8
|
100.5
|
100.8
|
98.5
|
100.7
|
101.0
|
98.1
|
100.7
|
101.2
|
% of 2001 Real Benefit
|
119.3
|
120.9
|
121.1
|
118.9
|
121.0
|
121.4
|
120.6
|
123.3
|
123.7
|
129.1
|
132.6
|
133.1
|
2032 Retiree
|
Present Law Scheduled Benefit
|
$813
|
$813
|
$813
|
$1,343
|
$1,343
|
$1,343
|
$1,774
|
$1,774
|
$1,774
|
$2,151
|
$2,151
|
$2,151
|
% Basic Change for All
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
% for PA Annuity**
|
9.6
|
13.4
|
14.1
|
12.9
|
18.0
|
19.0
|
15.6
|
21.8
|
23.0
|
19.3
|
26.6
|
27.9
|
% for Benefit Offset
|
-11.8
|
-11.8
|
-11.8
|
-15.9
|
-15.9
|
-15.9
|
-19.2
|
-19.2
|
-19.2
|
-23.6
|
-23.6
|
-23.6
|
Proposed Benefit
|
$795
|
$826
|
$832
|
$1,303
|
$1,371
|
$1,384
|
$1,710
|
$1,820
|
$1,841
|
$2,059
|
$2,216
|
$2,245
|
% of Present Law Scheduled Benefit
|
97.8
|
101.6
|
102.3
|
97.0
|
102.1
|
103.1
|
96.4
|
102.6
|
103.8
|
95.7
|
103.0
|
104.4
|
% of Present Law Payable Benefit
|
97.8
|
101.6
|
102.3
|
97.0
|
102.1
|
103.1
|
96.4
|
102.6
|
103.8
|
95.7
|
103.0
|
104.4
|
% of 2001 Real Benefit
|
124.9
|
129.7
|
130.6
|
123.8
|
130.4
|
131.6
|
125.2
|
133.2
|
134.8
|
133.8
|
144.1
|
146.0
|
2042 Retiree
|
Present Law Scheduled Benefit
|
$896
|
$896
|
$896
|
$1,478
|
$1,478
|
$1,478
|
$1,953
|
$1,953
|
$1,953
|
$2,365
|
$2,365
|
$2,365
|
% Basic Change for All
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
% for PA Annuity**
|
13.5
|
20.9
|
22.5
|
18.2
|
28.2
|
30.3
|
22.1
|
34.1
|
36.6
|
28.2
|
43.7
|
47.0
|
% for Benefit Offset
|
-17.4
|
-17.4
|
-17.4
|
-23.4
|
-23.4
|
-23.4
|
-28.3
|
-28.3
|
-28.3
|
-36.2
|
-36.2
|
-36.2
|
Proposed Benefit
|
$861
|
$928
|
$941
|
$1,402
|
$1,549
|
$1,580
|
$1,831
|
$2,067
|
$2,116
|
$2,175
|
$2,543
|
$2,619
|
% of Present Law Scheduled Benefit
|
96.2
|
103.6
|
105.1
|
94.8
|
104.8
|
106.9
|
93.7
|
105.8
|
108.3
|
92.0
|
107.5
|
110.7
|
% of Present Law Payable Benefit
|
131.5
|
141.7
|
143.8
|
129.7
|
143.4
|
146.2
|
128.2
|
144.7
|
148.2
|
125.8
|
147.1
|
151.5
|
% of 2001 Real Benefit
|
135.2
|
145.6
|
147.8
|
133.3
|
147.3
|
150.2
|
134.0
|
151.3
|
154.9
|
141.4
|
165.3
|
170.3
|
2052 Retiree
|
Present Law Scheduled Benefit
|
$986
|
$986
|
$986
|
$1,628
|
$1,628
|
$1,628
|
$2,151
|
$2,151
|
$2,151
|
$2,604
|
$2,604
|
$2,604
|
% Basic Change for All
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
% for PA Annuity**
|
15.0
|
24.2
|
26.2
|
20.1
|
32.6
|
35.3
|
24.4
|
39.5
|
42.8
|
32.8
|
54.2
|
58.9
|
% for Benefit Offset
|
-19.6
|
-19.6
|
-19.6
|
-26.4
|
-26.4
|
-26.4
|
-31.9
|
-31.9
|
-31.9
|
-43.3
|
-43.3
|
-43.3
|
Proposed Benefit
|
$940
|
$1,032
|
$1,052
|
$1,526
|
$1,730
|
$1,773
|
$1,989
|
$2,314
|
$2,384
|
$2,332
|
$2,888
|
$3,009
|
% of Present Law Scheduled Benefit
|
95.4
|
104.7
|
106.6
|
93.8
|
106.3
|
108.9
|
92.5
|
107.6
|
110.8
|
89.5
|
110.9
|
115.6
|
% of Present Law Payable Benefit
|
131.7
|
144.6
|
147.3
|
129.5
|
146.8
|
150.5
|
127.7
|
148.6
|
153.1
|
123.7
|
153.2
|
159.6
|
% of 2001 Real Benefit
|
147.6
|
162.0
|
165.1
|
145.1
|
164.4
|
168.6
|
145.6
|
169.4
|
174.5
|
151.6
|
187.8
|
195.7
|
2075 Retiree
|
Present Law Scheduled Benefit
|
$1,231
|
$1,231
|
$1,231
|
$2,032
|
$2,032
|
$2,032
|
$2,685
|
$2,685
|
$2,685
|
$3,250
|
$3,250
|
$3,250
|
% Basic Change for All
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
% for PA Annuity**
|
14.5
|
23.5
|
25.4
|
19.5
|
31.6
|
34.2
|
23.6
|
38.2
|
41.4
|
31.7
|
52.4
|
56.9
|
% for Benefit Offset
|
-19.0
|
-19.0
|
-19.0
|
-25.6
|
-25.6
|
-25.6
|
-30.9
|
-30.9
|
-30.9
|
-42.0
|
-42.0
|
-42.0
|
Proposed Benefit
|
$1,175
|
$1,286
|
$1,310
|
$1,908
|
$2,154
|
$2,207
|
$2,486
|
$2,880
|
$2,964
|
$2,917
|
$3,590
|
$3,737
|
% of Present Law Scheduled Benefit
|
95.5
|
104.5
|
106.4
|
93.9
|
106.0
|
108.6
|
92.6
|
107.3
|
110.4
|
89.8
|
110.5
|
115.0
|
% of Present Law Payable Benefit
|
142.4
|
155.9
|
158.7
|
140.1
|
158.2
|
162.0
|
138.2
|
160.1
|
164.7
|
133.9
|
164.8
|
171.5
|
% of 2001 Real Benefit
|
184.5
|
201.9
|
205.6
|
181.4
|
204.8
|
209.8
|
182.0
|
210.9
|
217.0
|
189.7
|
233.4
|
243.0
|
* Low Yield assumes the Treasury Bond yield on all assets, or risk adjusted returns. High Yield reflects a higher 7.1% ultimate real yield on equities, OR investing 60% of PA in equities at the assumed 6.5% yield. ** Annuity is assumed to have a net real yield equal to Long-Term Treasury Bonds, except for 100% Treasury case, where gross annuity yield is equal to Treasury.
Note: Based on 2001 Trustees Intermediate assumptions, including 3.0% Treasury ultimate real yield; plus 6.5% equity, 3.5% corporate bond ultimate real yields, and 0.3% annual ultimate PA and annuity administrative cost. For portfolios with part equity, balance is assumed 60% corporate and 40% Treasury bonds.
|
Office of the Actuary Social Security Administration January 29, 2002
|