The Old-Age and Survivors Insurance Trust Fund is a separate account in the United States Treasury. A fixed proportion (dependent on the allocation of tax rates by trust fund) of the payroll taxes received under the Federal Insurance Contributions Act and the Self-Employment Contributions Act are deposited in the fund to the extent that such taxes are not needed immediately to pay expenses. Taxes are deposited in the fund on every business day.
The trust fund provides automatic spending authority to pay monthly benefits to retired-worker (old-age) beneficiaries and their spouses and children and to survivors of deceased insured workers. With such spending authority, the Social Security Administration does not need to periodically request money from the Congress to pay benefits.
Funds not withdrawn for current cost (benefits, the financial interchange with the Railroad Retirement program, and administrative expenses) are invested in interest-bearing Federal securities, as required by law; the interest earned is also deposited in the trust fund.
The Old-Age and Survivors Insurance (OASI) Trust Fund was created pursuant to section 201 of the Social Security Act Amendments of 1939. These amendments also established a Board of Trustees. OASI became effective on January 1, 1940, and superseded the old-age reserve account established under the Social Security Act of 1935.
The Board of Trustees currently consists of 6 members, 4 of whom automatically serve by virtue of their positions in the Federal Government. These 4 are the
- Secretary of the Treasury (the Managing Trustee),
- Secretary of Labor,
- Secretary of Health and Human Services, and
- Commissioner of Social Security