the Board relating to the quality fac-
tors described in subclause (II) and 
the application demonstrates that the 
cost-of-living protection requirement 
described in subclause (III) are met. 
‘‘(II) QUALITY
FACTORS.—The 
quality factors described in this sub-
paragraph include the safety and 
soundness of the annuity, the experi-
ence and record of performance of the 
issuer issuing the annuity, and such 
other factors as the Board may deter-
mine appropriate. 
‘‘(III) COST-OF-LIVING
PROTEC-
TION REQUIREMENT.—The cost-of-liv-
ing requirement of this subclause is 
met only if the terms governing the 
annuity include procedures providing 
for adjustments in the amount of the 
monthly payments in the same man-
ner and to the same extent as adjust-
ments are provided for under the pro-
cedures 
used 
to 
adjust 
benefit 
amounts under section 215(i)(2)(A). 
Nothing in this subclause shall be
construed to preclude the terms gov-
erning such an annuity from pro-
viding for adjustments in the amount 
of monthly payments resulting in a 
payment for any month greater than 
the payment for that month that 
would result from adjustments re-
quired under the preceding sentence. 
‘‘(c) PURCHASE OF ANNUITIES IN THE EVENT OF IN-
SUFFICIENT ASSETS.—If a participating individual desires 
to purchase a personal social security savings annuity 
under subsection (b) on or after the date determined 
under subsection (a)(1) and the assets of the personal so-
cial security savings account of such individual are insuffi-
cient to purchase a personal social security savings annu-
ity that provides for a monthly payment that is at least 
equal to the minimum annuity payment amount (as de-
fined in subsection (b)(2)(C)(iii)), the participating indi-
vidual shall purchase the largest personal social security 
savings annuity that the participating individual’s per-
sonal social security savings account can fund and that 
otherwise meets the requirements of subsection (b) (in-
cluding the cost-of-living protection requirement of sub-
section (b)(3)(B)(iii)(III), and the Board shall provide for 
appropriate certification to the Secretary of the Treasury
with respect to the participating individual’s eligibility for 
guarantee payments under section 260. 
‘‘(d) RIGHT TO USE EXCESS PERSONAL SOCIAL SE-
CURITY SAVINGS ACCOUNT ASSETS.—To the extent assets 
credited to a participating individual’s personal social se-
curity savings account remain after the purchase of an an-
nuity under subsection (b), the remaining assets shall be 
payable to the participating individual at such time, in 
such manner, and in such amounts as the participating 
individual may specify. 
‘‘(e) DISTRIBUTIONS IN CASE OF DEATH.—If the 
participating individual dies before all amounts which are 
held in the Tier I Investment Fund or the Tier II Invest-
ment Fund of the Savings Fund or held under a Tier III 
Investment Option and which are credited to the personal 
social security savings account of the individual are other-
wise distributed in accordance with this section, such 
amounts shall be distributed, under regulations which 
shall be prescribed by the Board—
‘‘(1) in any case in which one or more bene-
ficiaries have been designated in advance, to such 
beneficiaries in accordance with such designation as 
provided in such regulations, and
‘‘(2) in the case of any amount not distributed 
as described in paragraph (1), to such individual’s 
estate. 
‘‘(f) PERSONAL SOCIAL SECURITY SAVINGS ANNU-
ITY.—For purposes of this part, the term ‘personal social 
security savings annuity’ means an annuity that meets the 
following requirements: 
‘‘(1) The annuity starting date (as defined in 
section 72(c)(4) of the Internal Revenue Code of 
1986) commences on the first day of the month be-
ginning after the date of the purchase of the annu-
ity. 
‘‘(2) The terms of the annuity provide, except 
in any case described in subsection (c), for a month-
ly payment to the participating individual during the 
life of the participating individual equal to at least 
the minimum annuity payment amount (as defined 
in subsection (b)(2)(C)(iii)). 
‘‘(3) The terms of the annuity include such 
terms and conditions as the Board requires for the 
protection of the annuitant (including terms meeting 
the 
cost-of-living 
requirement 
of 
subsection 
(b)(3)(B)(iii)(III)).
‘‘SEC. 260. GUARANTEE OF PROMISED BENEFITS. 
‘‘(a) IN GENERAL.—If, for any month ending after 
the date on which a participating individual attains retire-
ment age (as defined in section 216(l)(1)), the monthly 
payment under a participating individual’s personal social 
security savings annuity is less than the minimum annuity 
payment amount (as defined in section 259(b)(2)(C)(iii)), 
adjusted as provided in section 259(b)(3)(B)(iii)(III), the 
Board shall so certify to the Secretary of the Treasury 
and, upon receipt of such certification, such Secretary 
shall provide to the participating individual, from amounts 
in the Federal Old-Age and Survivors Insurance Trust 
Fund, a guaranty payment for such month to supplement 
the personal social security savings annuity and to guar-
antee full payment of such individual’s monthly promised 
benefits. 
‘‘(b) GUARANTY PAYMENT.—For purposes of sub-
section (a), a participating individual’s guaranty payment 
for any month is equal to the excess of—
‘‘(1) the minimum annuity payment amount (as 
defined in section 259(b)(2)(C)(iii)), adjusted as 
provided in section 259(b)(3)(B)(iii)(III); over 
‘‘(2) the payment for such month of the per-
sonal social security savings annuity purchased by 
the participating individual.