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Solvency Provisions |
## Provisions Affecting Level of Monthly BenefitsUpdated May 3, 2006 |

## Introduction |
These provisions modify the formula used for calculating the basic Social Security monthly benefit called the Primary Insurance Amount (PIA). For the provisions listed below, we provide estimates of the financial effect on the OASDI program over the long-range period (the next 75 years) and for the 75th year. In addition, we provide detailed single year tables. Tables and graphs are available in two formats: HTML and Portable Document Format (PDF). We recommend the PDF version for printing (requires Adobe Acrobat Reader). The year of the Trustees Report identifies the assumptions (intermediate) used in the preparation of the estimates. Choose the type of estimates (summary or detailed) from the list of provisions. |

Number | Table and graph selection |
---|---|

B1 | Increase the number of years used to calculate benefits for retirees
and survivors (but not for disabled workers) from 35 to 38, phased in
2006-2010. (2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B2 | Increase the number of years used to calculate benefits for retirees
and survivors (but not for disabled workers) from 35 to 40, phased in
2006-2014. (2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B3 | For each year from 2006-2036, multiply the 32 and 15 percent
formula factors by 0.987, reducing the factors to 21 percent
and 10 percent respectively,
for new eligibles in 2036 and later.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B4 | Reduce benefits by 3 percent for those newly eligible
for benefits in 2006 and later.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B5 | Reduce benefits by 5 percent for those newly eligible
for benefits in 2006 and later.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B6 | Beginning with those newly eligible for OASDI benefits in 2012 and
later, reduce PIA formula factors so that benefits grow by inflation
rather than by increases in real wages.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B7 | Progressive price indexing of PIA formula factors beginning with
individuals newly eligible for OASDI benefits in 2012. Create new bend
point at the 30th percentile of earners. Maintain current-law benefits
for earners at the 30th percentile and below and reduce upper 2 formula
factors (32% and 15%) such that maximum worker benefit grows by
inflation rather than the growth in average wages.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B8 | Progressive price indexing of PIA formula factors beginning with
individuals newly eligible for OASDI benefits in 2012. Create new bend
point at the 40th percentile of earners. Maintain current-law benefits
for earners at the 40th percentile and below and reduce upper 2 formula
factors (32% and 15%) such that maximum worker benefit grows by
inflation rather than the growth in average wages.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B9 | Progressive price indexing of PIA formula factors beginning with
individuals newly eligible for OASDI benefits in 2012. Create new bend
point at the 50th percentile of earners. Maintain current-law benefits
for earners at the 50th percentile and below and reduce upper 2 formula
factors (32% and 15%) such that maximum worker benefit grows by
inflation rather than the growth in average wages.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B10 | Progressive price indexing of PIA formula factors beginning with
individuals newly eligible for OASDI benefits in 2012. Create new bend
point at the 60th percentile of earners. Maintain current-law benefits
for earners at the 60th percentile and below and reduce upper 2 formula
factors (32% and 15%) such that maximum worker benefit grows by
inflation rather than the growth in average wages.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B11 |
Beginning with those newly eligible in 2013, multiply the 90 and 32
PIA factors each year by 0.9925 and 0.982, respectively.
Stop reductions in
2050. Beginning with those newly eligible in 2008, multiply the 15
factor by 0.982. Stop reduction of the 15 factor in 2045. DI will
have present law scheduled benefit and proportional reduction at
conversion to retired worker benefits at normal retirement age, based
on years of disability.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B12 |
Progressive price indexing of PIA formula factors beginning with
individuals newly eligible for OASI benefits in 2012. Create new
bend point at the 30th percentile of earners. Maintain current-law
benefits for earners at the 30th percentile and below and reduce
upper 2 formula factors (32% and 15%) such that maximum worker
benefit grows by inflation rather than the growth in average wages.
Disability benefits are not affected by the proposal. Disabled
worker beneficiaries, upon attaining normal retirement age, would
be subject to a proportional reduction in benefits based on the
worker's years of disability.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

B13 |
For OASI beneficiaries becoming eligible for benefits in 2018 and
later, multiply the PIA factors by the ratio of life expectancy at
67 for 2013 to the life expectancy at age 67 for the 4th year prior
to the year of benefit eligibility. Unisex life expectancies, based
on period life tables, would be used as projected by SSA's Office
of the Chief Actuary. Disability benefits are not affected by the
proposal. Disabled worker beneficiaries, upon attaining normal
retirement age, would be subject to a proportional reduction in
benefits based on the worker's years of disability.
(2005 Trustees Report)
Summary measures and graphs (PDF Version) |

Above provisions
Summary measures |

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