Office of the Chief Actuary 

Social Security AdministraƟon 

 Based on the 2023 Trustees Report Intermediate AssumpƟons 

These provisions invest a porƟon of the Social Security Trust funds in marketable 

securiƟes (e.g., equiƟes, corporate bonds), rather than in special-issue government 

bonds as under current law. For each provision, we provide an esƟmate of the financial 

effect on the OASDI program over the long-range period (the next 75 years) and for the 

75th year. We base all esƟmates on the intermediate assumpƟons described in the 

2023 Trustees Report. 

The selecƟons G3, G5, and G7 provide a low-yield or risk-adjusted perspecƟve where 

equity yields equal the average real yield on long-term Treasury bonds. Thus, these 

selecƟons have no effect on the actuarial balance of the OASDI program. Some 

analysts believe the higher expected return for equiƟes should not be included in 

valuaƟons because the tendency for higher average returns is compensaƟon for the 

higher volaƟlity in equiƟes. The low-yield or risk-adjusted assumpƟon reflects this 

perspecƟve. 

Provisions AffecƟng Trust Fund Investment in G Marketable SecuriƟes 
Long-range 

actuarial 

balance

Annual 

balance in 

75th year

Long-range 

actuarial 

balance

Annual 

balance in 

75th year

G1 0.47* 0.00 * 0%

G2 0.35* 0.00 * 0%

G3 0.00* 0.00 * 0%

G4 0.19* 0.00 * 0%

G5 0.00* 0.00 * 0%

G6 0.30* 0.00 * 0%

G7 0.00* 0.00 * 0%

Invest 15 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2024-2033), assuming an ultimate 5.8 percent annual real rate 

of return on equities.

Description of proposed provisions

Category G: Trust Fund Investment in Equities (2023 Trustees Report intermediate assumptions)

Current law shortfall in long-range actuarial balance is 3.61 percent of payroll and in annual balance for the 75th year is 4.35 percent of payroll.

Invest 40 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2024-2038), assuming an ultimate 5.8 percent annual real rate 

of return on equities.

Invest 40 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2024-2038), assuming an ultimate 4.8 percent annual real rate 

of return on equities.

Invest 40 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2024-2038), assuming an ultimate 2.3 percent annual real rate 

of return on equities. Thus, the ultimate rate of return on equities is the 

same as that assumed for Trust Fund bonds.

Change from current law

(percent of payroll)

Shortfall eliminated

Invest 15 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2024-2033), assuming an ultimate 2.3 percent annual real rate 

of return on equities. Thus, the ultimate rate of return on equities is the 

same as that assumed for Trust Fund bonds.

Invest 25 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2026-2035), assuming an ultimate 5.8 percent annual real rate 

of return on equities.

Invest 25 percent of the OASI and DI Trust Fund reserves in equities 

(phased in 2026-2035), assuming an ultimate 2.3 percent annual real rate 

of return on equities. Thus, the ultimate rate of return on equities is the 

same as that assumed for Trust Fund bonds.

* A change in the investment of trust fund reserves to include some equities affects the size of all summarized measures because increased 

"present-value" discounting reduces the weight on values for more distant future years. As a result, the magnitude of the current-law 

actuarial balance and the summarized effects of most proposals is reduced. Therefore, the size of the change in the long-range actuarial 

balance indicated here cannot be interpreted directly as a reduction in the shortfall. The actual reduction in the shortfall from equity 

investment depends on the amount of reserves that are available for investment throughout the period. For example, if provisions to change 

revenue or scheduled benefits resulted in a purely pay-as-you-go system (reserves just above zero throughout the period), then investment in 

equities would have no effect on the actuarial balance.

Office of the Chief Actuary

Social Security Administration

Based on the 2023 Trustees Report Intermediate Assumptions