Plan 1-V--1-Earner Couple with Equal Earnings
Full Annuitization of Personal Account Assets With a Variable Annuity Invested as Before Retirement
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
$1,078
$1,078
$1,078
$1,780
$1,780
$1,780
$2,353
$2,353
$2,353
$2,793
$2,793
$2,793
% 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**
1.2
1.6
1.6
1.6
2.1
2.2
1.9
2.5
2.6
3.1
4.0
4.1
% for Benefit Offset
-1.3
-1.3
-1.3
-1.8
-1.8
-1.8
-2.2
-2.2
-2.2
-3.4
-3.4
-3.4
Proposed Benefit
$1,077
$1,081
$1,081
$1,777
$1,786
$1,787
$2,347
$2,361
$2,363
$2,783
$2,808
$2,813
% of Present Law
Scheduled Benefit
99.9
100.2
100.3
99.8
100.3
100.4
99.8
100.4
100.5
99.6
100.5
100.7
% of Present Law
Payable Benefit
99.9
100.2
100.3
99.8
100.3
100.4
99.8
100.4
100.5
99.6
100.5
100.7
% of 2001
Real Benefit
112.7
113.1
113.2
112.6
113.2
113.3
114.6
115.2
115.4
120.6
121.7
121.9
2022 Retiree
Present Law
Scheduled Benefit
$1,140
$1,140
$1,140
$1,881
$1,881
$1,881
$2,486
$2,486
$2,486
$3,008
$3,008
$3,008
% 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**
3.6
5.2
5.5
4.8
7.0
7.4
5.8
8.5
9.0
7.5
10.8
11.5
% for Benefit Offset
-4.2
-4.2
-4.2
-5.6
-5.6
-5.6
-6.8
-6.8
-6.8
-8.8
-8.8
-8.8
Proposed Benefit
$1,133
$1,151
$1,155
$1,866
$1,907
$1,916
$2,461
$2,527
$2,541
$2,970
$3,069
$3,089
% of Present Law
Scheduled Benefit
99.4
101.0
101.3
99.2
101.4
101.8
99.0
101.6
102.2
98.7
102.0
102.7
% of Present Law
Payable Benefit
99.4
101.0
101.3
99.2
101.4
101.8
99.0
101.6
102.2
98.7
102.0
102.7
% of 2001
Real Benefit
118.5
120.5
120.9
118.2
120.9
121.4
120.1
123.3
124.0
128.7
133.0
133.9
2032 Retiree
Present Law
Scheduled Benefit
$1,204
$1,204
$1,204
$1,988
$1,988
$1,988
$2,627
$2,627
$2,627
$3,185
$3,185
$3,185
% 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**
6.5
10.6
11.5
8.7
14.2
15.4
10.6
17.2
18.7
13.0
21.0
22.7
% for Benefit Offset
-8.0
-8.0
-8.0
-10.7
-10.7
-10.7
-13.0
-13.0
-13.0
-15.9
-15.9
-15.9
Proposed Benefit
$1,186
$1,236
$1,246
$1,948
$2,057
$2,082
$2,563
$2,738
$2,777
$3,093
$3,346
$3,402
% of Present Law
Scheduled Benefit
98.5
102.6
103.5
98.0
103.5
104.7
97.6
104.2
105.7
97.1
105.0
106.8
% of Present Law
Payable Benefit
98.5
102.6
103.5
98.0
103.5
104.7
97.6
104.2
105.7
97.1
105.0
106.8
% of 2001
Real Benefit
124.2
129.3
130.5
123.5
130.4
131.9
125.1
133.6
135.5
134.1
145.0
147.5
2042 Retiree
Present Law
Scheduled Benefit
$1,326
$1,326
$1,326
$2,189
$2,189
$2,189
$2,893
$2,893
$2,893
$3,502
$3,502
$3,502
% 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**
9.1
16.6
18.3
12.3
22.3
24.7
14.9
27.0
29.9
19.0
34.6
38.3
% for Benefit Offset
-11.7
-11.7
-11.7
-15.8
-15.8
-15.8
-19.1
-19.1
-19.1
-24.5
-24.5
-24.5
Proposed Benefit
$1,292
$1,390
$1,414
$2,113
$2,332
$2,384
$2,770
$3,120
$3,204
$3,312
$3,857
$3,988
% of Present Law
Scheduled Benefit
97.4
104.8
106.6
96.5
106.5
108.9
95.8
107.9
110.8
94.6
110.1
113.9
% of Present Law
Payable Benefit
133.2
143.4
145.8
132.0
145.7
149.0
131.0
147.6
151.5
129.4
150.6
155.7
% of 2001
Real Benefit
135.2
145.5
148.0
133.9
147.8
151.1
135.2
152.3
156.4
143.6
167.2
172.9
2052 Retiree
Present Law
Scheduled Benefit
$1,460
$1,460
$1,460
$2,410
$2,410
$2,410
$3,185
$3,185
$3,185
$3,856
$3,856
$3,856
% 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**
10.1
19.2
21.5
13.6
25.9
28.9
16.5
31.3
35.0
22.2
43.0
48.2
% for Benefit Offset
-13.2
-13.2
-13.2
-17.8
-17.8
-17.8
-21.6
-21.6
-21.6
-29.3
-29.3
-29.3
Proposed Benefit
$1,415
$1,548
$1,581
$2,309
$2,605
$2,678
$3,023
$3,496
$3,613
$3,584
$4,386
$4,587
% of Present Law
Scheduled Benefit
96.9
106.0
108.2
95.8
108.1
111.1
94.9
109.8
113.4
92.9
113.7
118.9
% of Present Law
Payable Benefit
133.8
146.4
149.5
132.3
149.3
153.5
131.1
151.6
156.7
128.4
157.1
164.3
% of 2001
Real Benefit
148.0
162.0
165.4
146.3
165.1
169.7
147.5
170.7
176.3
155.3
190.1
198.8
2075 Retiree
Present Law
Scheduled Benefit
$1,823
$1,823
$1,823
$3,009
$3,009
$3,009
$3,975
$3,975
$3,975
$4,812
$4,812
$4,812
% 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**
9.8
18.7
20.9
13.1
25.2
28.1
15.9
30.5
34.1
21.4
41.8
46.9
% for Benefit Offset
-12.8
-12.8
-12.8
-17.3
-17.3
-17.3
-20.9
-20.9
-20.9
-28.3
-28.3
-28.3
Proposed Benefit
$1,767
$1,930
$1,970
$2,885
$3,247
$3,336
$3,777
$4,356
$4,499
$4,480
$5,460
$5,706
% of Present Law
Scheduled Benefit
96.9
105.9
108.1
95.9
107.9
110.9
95.0
109.6
113.2
93.1
113.5
118.6
% of Present Law
Payable Benefit
144.6
158.0
161.2
143.0
161.0
165.4
141.7
163.5
168.8
138.9
169.3
176.9
% of 2001
Real Benefit
184.9
202.0
206.2
182.8
205.8
211.4
184.4
212.6
219.6
194.2
236.7
247.3
* 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

Return to List of Tables Return to memorandum List of memos