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<title>I. GLOSSARY</title>
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<h2 class="pHeading1">2024 OASDI Trustees Report </h2>
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<blockquote>
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<div class="CodeAnchor"><a name="1042401"></a></div>
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<div class="Section">
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<span style="list-style-type: upper-alpha">I. </span><a name="1042403">GLOSSARY</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1037103">Actuarial balance</a></span></div>
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<div class="GlossaryDefinition"><a name="1039922">The difference between the summarized income rate and the summarized cost rate as a percentage of taxable payroll over a given valuation period.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1039925">Actuarial deficit</a></span></div>
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<div class="GlossaryDefinition"><a name="1006979">A negative actuarial balance.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005402">Administrative expenses</a></span></div>
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<div class="GlossaryDefinition"><a name="1006983">Expenses incurred by the Social Security Administration and the Department of the Treasury in administering the OASDI program and the provisions of the Internal Revenue Code relating to the collection of contributions. Such administrative expenses are paid from the OASI and DI Trust Funds.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005452">Advance tax transfers</a></span></div>
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<div class="GlossaryDefinition"><a name="1006985">Amounts representing the estimated total OASDI tax contributions for a given month. From May 1983 through November 1990, such amounts were credited to the OASI and DI Trust Funds at the beginning of each month. The trust funds reimbursed the General Fund of the Treasury for the associated loss of interest. Advance tax transfers are no longer made unless needed in order to pay benefits.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005408">Alternatives I, II, or III</a></span></div>
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<div class="GlossaryDefinition"><a href="#1005417" title="I. GLOSSARY" name="1006989"></a>See “<a href="#1005417" title="I. GLOSSARY">Assumptions</a>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1039765">Annual balance</a></span></div>
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<div class="GlossaryDefinition"><a name="1039766">The difference between the income rate and the cost rate for a given year.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005414">Asset reserves</a></span></div>
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<div class="GlossaryDefinition"><a href="#1059865" title="I. GLOSSARY" name="1057622"></a>See “<span ><a href="#1059865" title="I. GLOSSARY">Trust fund reserves</a></span>”.</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005417">Assumptions</a></span></div>
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<div class="GlossaryDefinition"><a name="1041544">Values related to future trends in key factors that affect the trust funds. Demographic assumptions include fertility, mortality, net immigration, marriage, and divorce. Economic assumptions include unemployment rates, average earnings, inflation, interest rates, and productivity. Program-specific assumptions include retirement patterns, and disability incidence and termination rates. This report presents three sets of demographic, economic, and program-specific assumptions:</a></div>
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<div class="Bullet_inner"><a name="1041552">Alternative II is the intermediate set of assumptions, and represents the Trustees’ best estimates of likely future demographic, economic, and program-specific conditions.</a></div>
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<div class="Bullet_inner"><a name="1041553">Alternative I is a low-cost set of assumptions—it assumes relatively rapid economic growth, high inflation, and favorable (from the standpoint of program financing) demographic and program-specific conditions.</a></div>
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<div class="Bullet_inner"><a name="1041554">Alternative III is a high-cost set of assumptions—it assumes relatively slow economic growth, low inflation, and unfavorable (from the standpoint of program financing) demographic and program-specific conditions.</a></div>
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<div class="Body"><a name="1005429">See tables </a><a href="V_A_demo.html#301601" title="V. ASSUMPTIONS AND METHODS UNDERLYING ACTUARIAL ESTIMATES">V.A2</a>, <a href="V_B_econ.html#292722" title="B. ECONOMIC ASSUMPTIONS AND METHODS">V.B1</a>, and <a href="V_B_econ.html#308187" title="B. ECONOMIC ASSUMPTIONS AND METHODS">V.B2</a>.</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005432">Automatic cost-of-living benefit increase</a></span></div>
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<div class="GlossaryDefinition"><a name="1045654">The annual increase in benefits, effective for December, reflecting the increase, if any, in the cost of living. A benefit increase is applicable only after a beneficiary becomes eligible for benefits. In general, the benefit increase equals the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI‑W) measured from the third quarter of the last year for which there was an increase to the third quarter of the current year. If there is no increase in the CPI-W, there is no cost-of-living benefit increase. See table </a><a href="V_C_prog.html#1047210" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C1</a>.</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005435">Auxiliary benefits</a></span></div>
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<div class="GlossaryDefinition"><a name="1007003">Monthly benefits payable to a spouse or child of a retired or disabled worker, or to a survivor of a deceased worker.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1045729">Average indexed monthly earnings — AIME</a></span></div>
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<div class="GlossaryDefinition"><a name="1045730">The measure of lifetime earnings used in determining the primary insurance amount (PIA) for most workers who attain age 62, become disabled, or die after 1978. A worker’s actual past earnings are adjusted by changes in the average wage index, in order to bring them up to their approximately equivalent value at the time of retirement or other eligibility for benefits.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005444">Average wage index — AWI</a></span></div>
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<div class="GlossaryDefinition"><a name="1006999">A series that generally increases with the average amount of total wages per worker with any wages for each year after 1950, including wages in noncovered employment and wages in covered employment in excess of the OASDI contribution and benefit base. (See Title 20, Chapter III, section 404.211(c) of the Code of Federal Regulations for a more precise definition.) The average wage index is used to index the taxable earnings of most workers first becoming eligible for benefits in 1979 or later, and for automatic adjustments in the contribution and benefit base, bend points, earnings test exempt amounts, and other wage-indexed amounts. See tables </a><a href="V_C_prog.html#1047210" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C1</a> and <a href="VI_G3_OASDHI_dollars.html#182913" title="3. Estimates in Dollars">VI.G6</a>.</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005447">Award</a></span></div>
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<div class="GlossaryDefinition"><a name="1006997">An administrative determination that an individual is entitled to receive a specified type of OASDI benefit. Awards can represent not only new entrants to the benefit rolls but also persons already on the rolls who become entitled to a different type of benefit. Awards usually result in the immediate payment of benefits, although payments may be deferred or withheld depending on the individual’s particular circumstances.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005450">Baby boom</a></span></div>
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<div class="GlossaryDefinition"><a name="1007016">The period from the end of World War II (1946) through 1965 marked by unusually high birth rates.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005453">Bend points</a></span></div>
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<div class="GlossaryDefinition"><a name="1007018">The dollar amounts defining the AIME or PIA brackets in the benefit formulas. For the bend points for years 1979 and later, see table </a><a href="V_C_prog.html#1031432" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C2</a>.</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1006205">Beneficiary</a></span></div>
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<div class="GlossaryDefinition"><a name="1007020">A person who has been awarded benefits on the basis of his or her own or another’s earnings record. The benefits may be either in current-payment status or withheld.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1006210">Benefit award</a></span></div>
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<div class="GlossaryDefinition"><a href="#1005447" title="I. GLOSSARY" name="1007022"></a>See “<span ><a href="#1005447" title="I. GLOSSARY">Award</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1054379">Benefit conversion</a></span></div>
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<div class="GlossaryDefinition"><a name="1054383"></a>See “<span ><a href="#1045220" title="I. GLOSSARY">Disability conversion</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005396">Benefit payments</a></span></div>
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<div class="GlossaryDefinition"><a name="1007030">The amounts disbursed for OASI and DI benefits by the Department of the Treasury.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005470">Benefit termination</a></span></div>
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<div class="GlossaryDefinition"><a href="#1046437" title="I. GLOSSARY" name="1007024"></a>See “<span ><a href="#1046437" title="I. GLOSSARY">Termination</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1048212">Best estimate assumptions</a></span></div>
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<div class="GlossaryDefinition"><a href="#1005417" title="I. GLOSSARY" name="1048216"></a>See “<span><a href="#1005417" title="I. GLOSSARY">Assumptions</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1048219">Board of Trustees</a></span></div>
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<div class="GlossaryDefinition"><a name="1048153">A Board established by the Social Security Act to oversee the financial operations of the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund. The Board is composed of six members. Four members serve by virtue of their positions in the Federal Government: the Secretary of the Treasury, who is the Managing Trustee; the Secretary of Labor; the Secretary of Health and Human Services; and the Commissioner of Social Security. The President appoints and the Senate confirms the other two members to serve as public representatives. Also referred to as the “Board” or the “Trustees.”</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1045036">Cash flow</a></span></div>
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<div class="GlossaryDefinition"><a name="1045037">Actual or projected revenue (other than interest paid to the trust funds) and costs reflecting the levels of payroll tax contribution rates and benefits scheduled in the law. Net cash flow is the difference between non-interest income and cost.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005488">Consumer Price Index — CPI</a></span></div>
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<div class="GlossaryDefinition"><a name="1007050">An official measure of inflation in consumer prices. In this report, CPI refers to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Bureau of Labor Statistics, Department of Labor, publishes historical values for the CPI-W.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1043018">Contribution and benefit base</a></span></div>
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<div class="GlossaryDefinition"><a name="1046110">Annual dollar amount above which earnings in employment covered under the OASDI program are neither taxable nor creditable for benefit-computation purposes. (Also referred to as maximum contribution and benefit base, annual creditable maximum, taxable maximum, and maximum taxable.) See tables </a><a href="V_C_prog.html#1047210" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C1</a> and <a href="V_C_prog.html#284997" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C6</a>. See “<span><a href="#1041877" title="I. GLOSSARY">Hospital Insurance (HI) contribution base</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1046401">Contributions</a></span></div>
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<div class="GlossaryDefinition"><a href="#1045940" title="I. GLOSSARY" name="1046402"></a>See “<span><a href="#1045940" title="I. GLOSSARY">Payroll tax contributions</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1054442">Conversion</a></span></div>
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<div class="GlossaryDefinition"><a name="1054438"></a>See “<span><a href="#1045220" title="I. GLOSSARY">Disability conversion</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1046150">Cost</a></span></div>
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<div class="GlossaryDefinition"><a name="1046199">The cost shown for a year includes benefits scheduled for payment in the year (without regard to the ability to make the payments in full), administrative expenses, financial interchange with the Railroad Retirement program, and payments for vocational rehabilitation services for disabled beneficiaries.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1046184">Cost-of-living adjustment</a></span></div>
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<div class="GlossaryDefinition"><a href="#1005432" title="I. GLOSSARY" name="1045108"></a>See “<span><a href="#1005432" title="I. GLOSSARY">Automatic cost-of-living benefit increase</a></span>.”</div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005511">Cost rate</a></span></div>
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<div class="GlossaryDefinition"><a name="1007080">The cost rate for a year is the ratio of the cost of the program to the taxable payroll for the year.</a></div>
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<div class="Glossaryterm"><span class="Bold"><a name="1005514">Covered earnings</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007082">Wages or earnings from self-employment covered by the OASDI program.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005517">Covered employment</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007084">All employment for which earnings are creditable for Social Security purposes. The program covers almost all employment. Some exceptions are:</a></div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1041459">State and local government employees whose employer has not elected to be covered under Social Security and who are participating in an employer-provided pension plan.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1041460">Current Federal civilian workers hired before 1984 who have not elected to be covered.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1041461">Self-employed workers earning less than $400 in a calendar year.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1007619">Covered worker</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048546">A person who has earnings creditable for Social Security purposes based on services for wages in covered employment or income from covered self-employment.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1048562">CPI-indexed dollars</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048576">Amounts adjusted by the CPI to the value of the dollar in a particular year.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1048548">Creditable earnings</a></span></div>
|
||
<div class="GlossaryDefinition"><span><a name="1048549">Wages or self-employment earnings posted to a worker’s earnings record. Such earnings determine eligibility for benefits and the amount of benefits on that worker’s record. The contribution and benefit base is the maximum amount of creditable earnings for each worker in a calendar year.</a></span></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1041463">Current-cost financing</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007088"></a>See “<span><a href="#1005693" title="I. GLOSSARY">Pay-as-you-go financing</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005526">Current dollars</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007090">Amounts expressed in nominal dollars with no adjustment for inflation.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1048606">Currently insured status</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048599">A worker is currently insured when he or she has accumulated six quarters of coverage during the 13-quarter period ending with the current quarter.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005529">Current-payment status</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007100">Status of a beneficiary to whom a benefit is being paid for a given month (with or without deductions, provided the deductions add to less than a full month’s benefit).</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1053174">Deemed filing</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1053120">Under certain circumstances, a person applying for or receiving either an aged-spouse benefit or a retired-worker benefit is required to also file for the other of these two types of benefits. For those first eligible for benefits before 2016, this requirement applies to any person under normal retirement age who is eligible for the other benefit as of the starting month for the first benefit. For those first eligible for benefits in 2016 and later, this requirement applies whenever the person is eligible for the other benefit. This can occur at any age, and in months after the starting month of the first benefit.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005532">Deemed wage credit</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007098"></a>See “<span><a href="#1005671" title="I. GLOSSARY">Military service wage credits</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1025755">Delayed retirement credits</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1025756">Increases in the benefit amount for certain individuals who did not receive benefits for months after attaining normal retirement age but before age 70. Delayed retirement credits apply to benefits for January of the year following the year they are earned or for the month of attainment of age 70, whichever comes first. See table </a><a href="V_C_prog.html#180548" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C3</a>.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005533">Demographic assumptions</a></span></div>
|
||
<div class="GlossaryDefinition"><a href="#1005417" title="I. GLOSSARY" name="1007096"></a>See “<span><a href="#1005417" title="I. GLOSSARY">Assumptions</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005539">Disability</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007092">For Social Security purposes, the inability to engage in any substantial gainful activity (</a>See “<span><a href="#1007470" title="I. GLOSSARY">Substantial gainful activity — SGA</a></span>”) by reason of any medically determinable physical or mental impairment that can be expected to result in death or to last for a continuous period of not less than 12 months. Special rules apply for workers at ages 55 and over whose disability is based on blindness.</div>
|
||
<div class="GlossaryDefinition"><a name="1045168">The law generally requires that a person be disabled continuously for 5 months before he or she can qualify for a disabled-worker benefit.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045184">Disability conversion ratio</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045202">For a given year, the ratio of the number of disability conversions to the average number of disabled-worker beneficiaries at all ages during the year.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045220">Disability conversion</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045221">Upon attainment of normal retirement age, a disabled-worker beneficiary is automatically converted to retired-worker status.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045205">Disability incidence rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045173">The proportion of workers in a given year, insured for but not receiving disability benefits, who apply for and are awarded disability benefits.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005555">Disability Insurance (DI) Trust Fund</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007104"></a>See “<span><a href="#1005832" title="I. GLOSSARY">Trust fund</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1048648">Disability insured status</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048642">A worker is disability insured if he or she is: (1) a fully insured worker who has accumulated 20 quarters of coverage during the 40-quarter period ending with the current quarter, (2) a fully insured worker aged 24-30 who has accumulated quarters of coverage during one-half of the quarters elapsed after the quarter of attainment of age 21 and up to and including the current quarter, or (3) a fully insured worker under age 24 who has accumulated six quarters of coverage during the 12-quarter period ending with the current quarter.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045242">Disability prevalence rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045243">The proportion of persons insured for disability benefits who are disabled-worker beneficiaries in current-payment status.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005559">Disability termination rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007108">The proportion of disabled-worker beneficiaries in a given year whose disability benefits terminate as a result of their recovery or death.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005558">Disabled-worker benefit</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007110">A monthly benefit payable to a disabled worker under normal retirement age and insured for disability. Before November 1960, disability benefits were limited to disabled workers aged 50-64.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1056546">Dual entitlement</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1056548">A person may be entitled to more than one benefit at the same time. For example, a person may be entitled as a retired worker on his or her own record and as a spouse on another record. However, a person's benefit amount can never exceed the highest single benefit to which that person is entitled. Some benefits are calculated independently with the larger benefit being paid or the smaller benefit being paid plus the excess amount of the larger one.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005564">Earnings</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007112">Unless otherwise qualified, all wages from employment and net earnings from self-employment, whether or not they are taxable or covered.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005567">Earnings test</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007114">The provision requiring the withholding of benefits if beneficiaries under normal retirement age have earnings in excess of certain exempt amounts. See table </a><a href="V_C_prog.html#1047210" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C1</a>.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005570">Economic assumptions</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007116"></a>See “<span><a href="#1005417" title="I. GLOSSARY">Assumptions</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005574">Effective interest rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007118"></a>See “<span><a href="#1005647" title="I. GLOSSARY">Interest rate</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005577">Excess wages</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007120">Wages in excess of the contribution and benefit base on which a worker initially makes payroll tax contributions, usually as a result of working for more than one employer during a year. Employee payroll taxes on excess wages are refundable to affected employees, while the employer taxes are not refundable.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1042832">Expenditures</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1042836">Actual payments made or expected to be made under current law, including benefits paid or payable, administrative expenses, financial interchange with the Railroad Retirement program, and payments for vocational rehabilitation services for disabled beneficiaries. Includes only the portion of cost that is payable with the financing provisions in current law.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1060543">Exposed population</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1060544">For any event (such as being awarded a benefit, or dying), the group that is exposed to the possibility of experiencing the event. For example, the exposed population for disabled worker awards (incidence) is the disability insured population less those already receiving benefits.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005580">Federal Insurance Contributions Act — FICA</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007122">Provision authorizing payroll taxes on the wages of employed persons to provide for Old-Age, Survivors, and Disability Insurance, and for Hospital Insurance. Workers and their employers generally pay the tax in equal amounts.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005585">Financial interchange</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007124">Provisions of the Railroad Retirement Act providing for transfers between the trust funds and the Social Security Equivalent Benefit Account of the Railroad Retirement program in order to place each trust fund in the same financial position it would have been had railroad employment always been covered under Social Security.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005588">Fiscal year</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043445">The accounting year of the United States Government. Starting in 1976, a fiscal year is the 12-month period ending September 30. For example, fiscal year 2024 began October 1, 2023, and will end September 30, 2024.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043447">Full advance funding</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048744">A financing method in which contributions are established to match the full cost of future benefits as these costs are incurred through current service. Such financing methods also provide for amortization over a fixed period of any financial obligation that is incurred at the beginning of the program (or subsequent modification) as a result of granting credit for past service.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1048745">Fully insured status</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048746">A worker is fully insured when his or her total number of quarters of coverage is greater than or equal to the number of years elapsed after the year of attainment of age 21 (but not less than six). Once a worker has accumulated 40 quarters of coverage, he or she remains permanently fully insured.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005594">General Fund of the Treasury</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007130">Funds held by the Treasury of the United States, other than income collected for a specific purpose (such as Social Security) and maintained in a separate account for that purpose.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005571">General Fund reimbursements</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007132">Payments from the General Fund of the Treasury to the trust funds for specific items defined in the law, including:</a></div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1005602">The cost of noncontributory wage credits for military service before 1957, and periodic adjustments of previous determinations.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1046238">The cost in 1971-82 of deemed wage credits for military service performed after 1956.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1046249">The cost of benefits to certain uninsured persons who attained age 72 before 1968.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1046256">The cost of payroll tax credits provided to employees in 1984 and self-employed persons in 1984-89 by Public Law 98-21.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1046263">The cost in 2009-17 of excluding certain self-employment earnings from SECA taxes under Public Law 110-246.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1046270">Payroll tax revenue forgone under the provisions of Public Laws 111-147, 111-312, 112-78, and 112-96.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1060957">A portion of proceeds from repayments of loans authorized under Public Law 116-136.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="GlossaryDefinition"><a name="1052054">The General Fund also reimburses the trust funds for various other items, including interest on checks which are not negotiated 6 months after the month of issue and costs incurred in performing certain legislatively mandated activities not directly related to administering the OASI and DI programs.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1052057">Gross domestic product — GDP</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1052058">The total dollar value of all goods and services produced by labor and property located in the United States, regardless of who supplies the labor or property.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1041877">Hospital Insurance (HI) contribution base</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1041878">Annual dollar amount above which earnings in employment covered under the HI program are not taxable. (Also referred to as maximum contribution base, taxable maximum, and maximum taxable.) Beginning in 1994, the HI contribution base was eliminated.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1006784">High-cost assumptions</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007140"></a>See “<span><a href="#1005417" title="I. GLOSSARY">Assumptions</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1006785">Hospital Insurance (HI) Trust Fund</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007142"></a>See “<span><a href="#1005832" title="I. GLOSSARY">Trust fund</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043023">Immigration</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043027"></a>See “<span><a href="#1045275" title="I. GLOSSARY">Lawful permanent resident (LPR) immigration</a></span>” and “<span ><a href="#1045291" title="I. GLOSSARY">Other-than-LPR immigration</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045064">Income</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045065">Income for a given year is the sum of tax revenue on a cash basis (payroll tax contributions and income from the taxation of scheduled benefits), reimbursements from the General Fund of the Treasury, if any, and interest credited to the trust funds.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005633">Income rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007154">Ratio of non-interest income to the OASDI taxable payroll for the year.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045687">Infinite horizon</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045688">The period extending indefinitely into the future.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045691">Inflation</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045692">An increase in the general price level of goods and services.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005639">Insured status</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007150">The state or condition of having sufficient quarters of coverage to meet the eligibility requirements for retired-worker or disabled-worker benefits, or to permit the worker’s spouse and children or survivors to establish eligibility for benefits in the event of his or her disability, retirement, or death. </a>See “<span><a href="#1005722" title="I. GLOSSARY">Quarter of coverage</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005644">Interest</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007146">A payment in exchange for the use of money during a specified period.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005647">Interest rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007144">Interest rates on new public-debt obligations issuable to Federal trust funds (</a>See “<span><a href="#1005748" title="I. GLOSSARY">Special public-debt obligation</a></span>”) are determined monthly. Such rates are equal to the average market yield on all outstanding marketable U.S. securities not due or callable until after 4 years from the date the rate is determined. See table <a href="V_B_econ.html#308187" title="B. ECONOMIC ASSUMPTIONS AND METHODS">V.B2</a> for historical and assumed future interest rates on new special-issue securities. The effective interest rate for a trust fund is the ratio of the interest earned by the fund over a given period of time to the average level of asset reserves held by the fund during the period. The effective rate of interest thus represents a measure of the overall average interest earnings on the fund’s portfolio of investments. See table <a href="VI_G3_OASDHI_dollars.html#182913" title="3. Estimates in Dollars">VI.G6</a> for projected compound new-issue interest factors and compound effective trust-fund interest factors.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1007652">Interfund borrowing</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007653">The borrowing of asset reserves by a trust fund (OASI, DI, or HI) from another trust fund when the first fund is in danger of depletion. The Social Security Act permitted interfund borrowing only during 1982 through 1987, and required all amounts borrowed to be repaid prior to the end of 1989. The only exercise of this authority occurred in 1982, when the OASI Trust Fund borrowed from the DI and HI Trust Funds. The final repayment of borrowed amounts occurred in 1986.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005651">Intermediate assumptions</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007159"></a>See “<span><a href="#1005417" title="I. GLOSSARY">Assumptions</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045275">Lawful permanent resident (LPR) immigration</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045276">The flow of persons who enter the Social Security area population and are granted LPR status, or who are already in the Social Security area population and adjust their status to become LPRs. Persons who enter the country with legal visas but without LPR status, such as temporary foreign workers and students, are not included in the LPR immigration category.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1057964">Legal emigration</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1057965">The flow of lawful permanent residents and citizens who leave the Social Security area population.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043091">Life expectancy</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043092">Average remaining number of years expected prior to death. Period life expectancy is calculated for a given year using the actual or expected death rates at each age for that year. Cohort life expectancy, sometimes referred to as generational life expectancy, is calculated for individuals at a specific age in a given year using actual or expected death rates from the years in which the individuals would actually reach each succeeding age if they survive.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005654">Long-range</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043567">The first 75 projection years. The Trustees make long-range actuarial estimates for this period because it covers approximately the maximum remaining lifetime for virtually all current Social Security participants.</a></div>
|
||
<div class="GlossaryDefinition"><span class="Bold"><a name="1045420">Low-cost assumptions </a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007159250"></a>See “<span ><a href="#1005417" title="I. GLOSSARY">Assumptions</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005660">Lump-sum death </a></span>payment</div>
|
||
<div class="GlossaryDefinition"><a name="1007165">A lump sum, generally $255, payable on the death of a fully or currently insured worker. The lump sum is payable to the surviving spouse of the worker, under most circumstances, or to the worker’s children.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005663">Maximum family benefit</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007167">The maximum monthly amount that can be paid on a worker’s earnings record. Whenever the total of the individual monthly benefits payable to all the beneficiaries entitled on one earnings record exceeds the maximum, each dependent’s or survivor’s benefit is proportionately reduced. Benefits payable to divorced spouses or surviving divorced spouses are not reduced under the family maximum provision.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005666">Medicare</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007169">A nationwide, Federally administered health insurance program authorized in 1965 under Title XVIII of the Social Security Act to cover the cost of hospitalization, medical care, and some related services for most persons age 65 and over. In 1972, lawmakers extended coverage to persons receiving Social Security Disability Insurance payments for 2 years and persons with End-Stage Renal Disease. (For beneficiaries whose primary or secondary diagnosis is Amyotrophic Lateral Sclerosis, the 2-year waiting period is waived.) In 2010, persons exposed to environmental health hazards within areas under a corresponding emergency declaration became Medicare-eligible. In 2006, prescription drug coverage was added as well. Medicare consists of two separate but coordinated trust funds — Hospital Insurance (HI, Part A) and Supplementary Medical Insurance (SMI). The SMI Trust Fund is composed of two separate accounts — the Part B account and the Part D account. Almost all persons who are aged 65 and over or disabled and who are entitled to HI are eligible to enroll in Part B and Part D on a voluntary basis by paying monthly premiums.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005671">Military service wage credits</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1025985">Credits toward OASDI earnings records for benefit computation purposes, recognizing that military personnel receive non-wage compensation (such as food and shelter) in addition to their basic pay and other cash payments. Military personnel do not pay payroll taxes on these credits. Noncontributory wage credits of $160 were provided for each month of active military service from September 16, 1940, through December 31, 1956. For years after 1956, the basic pay of military personnel is covered under the Social Security program on a contributory basis. In addition to the contributory credits for basic pay, noncontributory wage credits of $300 were granted for each calendar quarter, from January 1957 through December 1977, in which a person received pay for military service. Noncontributory wage credits of $100 were granted for each $300 of military wages, up to a maximum credit of $1,200 per calendar year, from January 1978 through December 2001.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1025986">National average wage index — AWI</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1049634"></a>See “<span><a href="#1005444" title="I. GLOSSARY">Average wage index — AWI</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1049636">Non-interest income</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1049637">Non-interest income for a given year is the sum of tax revenue on a cash basis (payroll tax contributions and income from the taxation of scheduled benefits) and reimbursements from the General Fund of the Treasury, if any.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1057353">Nonresident alien beneficiary</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1057354">An OASDI beneficiary who is not a U.S. citizen and who is living abroad while receiving benefits.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1049628">Normal retirement age — NRA</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007178">The age at which a person may first become entitled to retirement benefits without reduction based on age. For persons reaching age 62 before 2000, the normal retirement age is 65. It increases gradually to 67 for persons reaching age 62 in 2022 or later, beginning with an increase to 65 years and 2 months for persons reaching age 62 in 2000. See table </a><a href="V_C_prog.html#180548" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C3</a>.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005677">Old-Age and Survivors Insurance (OASI) Trust Fund</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007180"></a>See “<span><a href="#1005832" title="I. GLOSSARY">Trust fund</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005684">Old-law base</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007182">Amount the contribution and benefit base would have been if the 1977 amendments had not provided for ad hoc increases. The Social Security Amendments of 1972 provided for automatic annual indexing of the contribution and benefit base. The Social Security Amendments of 1977 specified ad hoc bases for 1978‑81, with subsequent bases updated in accordance with the normal indexing procedure. See table </a><a href="V_C_prog.html#1031432" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C2</a>.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043251">Open-group unfunded obligation</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1049126"></a>See “<span><a href="#1049365" title="I. GLOSSARY">Unfunded obligation</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045286">Other-than-LPR emigration</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045287">The flow of other</a><span class="Bold" style="font-weight: normal">-than-LPR</span> immigrants who leave the Social Security area population or who adjust their status to become LPRs.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045291">Other-than-LPR immigration</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045292">The flow of persons who enter the Social Security area population and stay to the end of the year without being granted LPR status, such as undocumented immigrants, and foreign workers and students entering with temporary visas.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005687">Par value</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007196">The value printed on the face of a bond. For special issues held by the trust funds, par value is the redemption value at any time up to maturity.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005690">Partial advance funding</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007192">A financing method in which contribution levels are established to provide a substantial accumulation of trust fund asset reserves, thereby generating interest income to the trust funds and reducing the need for contribution increases or cost reductions in periods when costs are relatively high or income is relatively low. The trust fund buildup under partial advance funding is smaller than it would be with full advance funding.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005693">Pay-as-you-go financing</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1025802">A financing method in which contribution levels are established with the intent to produce annual income levels required to pay current benefits, with trust fund asset reserves built up only to the extent needed to prevent immediate depletion of the fund reserves by random fluctuations.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045940">Payroll tax contributions</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045960">The amount based on a percent of earnings, up to an annual maximum, that must be paid by:</a></div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1045962">employers and employees on wages from employment under the Federal Insurance Contributions Act,</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1045964">the self-employed on net earnings from self-employment under the Self-Employment Contributions Act, and</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Bullet_outer" style="margin-left: 0pt">
|
||
<table border="0" cellspacing="0" cellpadding="0" summary="" role="presentation">
|
||
<tr style="vertical-align: baseline">
|
||
<td>
|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1045947">States on the wages paid in 1986 and earlier to State and local government employees covered under the Social Security Act through voluntary agreements under section 218 of the act.</a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="GlossaryDefinition"><a name="1045993">Also referred to as payroll taxes.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005701">Present value</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007184">The interest-adjusted equivalent value, at the present time, of a stream of values (either positive or negative, past or future). Present value is used widely in calculations involving financial transactions over long periods of time to account for the time value of money, by discounting or accumulating these transactions at the rate of interest. Present-value calculations for this report use the effective yield on combined OASI and DI Trust Fund asset reserves.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005707">Primary insurance amount—PIA</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007204">The monthly amount payable to a retired worker who begins to receive benefits at normal retirement age or, generally, to a disabled worker. This amount, which is typically related to the worker’s average monthly wage or average indexed monthly earnings, is also used as a base for computing all types of benefits payable on an individual’s earnings record.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005714">Primary-insurance-amount formula</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007202">The mathematical formula relating the PIA to the AIME for workers who attain age 62, become disabled, or die after 1978. The PIA is equal to the sum of 90 percent of AIME up to the first bend point, plus 32 percent of AIME above the first bend point up to the second bend point, plus 15 percent of AIME in excess of the second bend point. Automatic benefit increases are applied beginning with the year of eligibility. See table </a><a href="V_C_prog.html#1031432" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C2</a> for historical and assumed future bend points and table <a href="V_C_prog.html#1047210" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C1</a> for historical and assumed future benefit increases.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005722">Quarter of coverage</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007200">Basic unit of measurement for determining insured status. For 1978, a worker earned one quarter of coverage, up to four, for each $250 of that worker’s annual covered earnings. After 1978, the $250 amount increases automatically with increases in the national average wage index. See table </a><a href="V_C_prog.html#1031432" title="C. PROGRAM-SPECIFIC ASSUMPTIONS AND METHODS">V.C2</a>. </div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005725">Railroad Retirement</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007198">A Federal insurance program, similar to Social Security, designed for workers in the railroad industry. The provisions of the Railroad Retirement Act provide for a system of coordination and financial interchange between the Railroad Retirement program and the Social Security program.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005728">Reallocation of payroll tax rates</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007222">An increase in the payroll tax rate for either the OASI or DI Trust Fund, with a corresponding reduction in the rate for the other fund, so that the total OASDI payroll tax rate is not changed. </a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005737">Recession</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1050584">A period of adverse economic conditions, generally defined as two or more successive calendar quarters of negative real growth in gross domestic product.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1050597">Reserves</a></span></div>
|
||
<div class="GlossaryDefinition"><a href="#1059865" title="I. GLOSSARY" name="1050593"></a>See “<span><a href="#1059865" title="I. GLOSSARY">Trust fund reserves</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1050587">Retired-worker benefit</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1050588">A monthly benefit payable to a fully insured retired worker aged 62 or older or to a person entitled under the transitionally insured status provision in the law.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005771">Retirement earnings test</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007212"></a>See “<span><a href="#1005567" title="I. GLOSSARY">Earnings test</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045120">Retirement eligibility age</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045121">The age, currently age 62, at which a fully insured individual first becomes eligible to receive retired-worker benefits.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1051838">Scheduled benefits</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1051952">The level of benefits specified under current law.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1051956">Scenario-based model</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1051957">A model with specified assumptions for and relationships among variables. Under such a model, any specified set of assumptions determines a single outcome directly reflecting the specifications.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005758">Self-employment</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007208">Operation of a trade or business by an individual or by a partnership in which an individual is a member.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005755">Self-Employment Contributions Act – SECA</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007206">Provision authorizing Social Security payroll taxes on the net earnings of most self-employed persons.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005752">Short-range</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007232">The first 10 projection years. The Social Security Act requires estimates for 5 years; the Trustees prepare estimates for an additional 5 years to help clarify trends that are only starting to develop in the mandated first 5-year period. </a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005749">Social Security Act</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007230">Provisions of the law governing most operations of the Social Security program. The original Social Security Act is Public Law 74‑271, enacted August 14, 1935. With subsequent amendments, the Social Security Act consists of 21 titles, of which three have been repealed. Title II of the Social Security Act authorizes the Old-Age, Survivors, and Disability Insurance program.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1045918">Social Security area population</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1045919">The population composed of: (1) residents of the 50 States and the District of Columbia (adjusted for net census undercount); (2) civilian residents of Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands; (3) Federal civilian employees and persons in the U.S. Armed Forces abroad and their dependents; (4) non-citizens living abroad who are insured for Social Security benefits; and (5) all other U.S. citizens abroad.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043273">Solvency</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043269">A program is solvent at a point in time if it is able to pay scheduled benefits when due with scheduled financing. For example, the OASDI program is solvent over any period for which the trust funds maintain a positive level of asset reserves.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005748">Special public-debt obligation</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007228">Securities of the United States Government issued exclusively to the OASI, DI, HI, and SMI Trust Funds and other Federal trust funds. Section 201(d) of the Social Security Act provides that the public-debt obligations issued for purchase by the OASI and DI Trust Funds shall have maturities fixed with due regard for the needs of the funds. The usual practice has been to spread the holdings of special issues, as of each June 30, so that the amounts maturing in each of the next 15 years are approximately equal. Special public-debt obligations are redeemable at par value at any time and carry interest rates determined by law (</a>See “<span><a href="#1005647" title="I. GLOSSARY">Interest rate</a></span>”). See tables <a href="VI_A_cyoper_hist.html#297482" title="VI. APPENDICES">VI.A4</a> and <a href="VI_A_cyoper_hist.html#297536" title="VI. APPENDICES">VI.A5</a> for a listing of the obligations held by the OASI and DI Trust Funds, respectively.</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043000">Stochastic model</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043001">A model used for projecting a probability distribution of potential outcomes. Such models allow for random variation in one or more variables through time. The random variation is generally based on fluctuations observed in historical data for a selected period. A large number of simulations, each of which reflects random variation in the variable(s), produce a distribution of potential outcomes.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1007470">Substantial gainful activity — SGA</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007471">The level of work activity used to establish disability. A finding of disability requires that a person be unable to engage in substantial gainful activity. A person who earns more than a certain monthly amount (net of impairment-related work expenses) is ordinarily considered to be engaging in SGA. The amount of monthly earnings considered as SGA depends on the nature of a person’s disability. The Social Security Act specifies a higher SGA amount for statutorily blind individuals; Federal regulations specify a lower SGA amount for non-blind individuals. Both SGA amounts increase with increases in the national average wage index.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1007452">Summarized balance</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007224">The difference between the summarized income rate and the summarized cost rate, expressed as a percentage of GDP. The difference between the summarized income rate and cost rate as a percentage of taxable payroll is referred to as the actuarial balance.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005782">Summarized cost rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007242">The ratio of the present value of cost to the present value of the taxable payroll (or GDP) for the years in a given period, expressed as a percentage. To evaluate the financial adequacy of the program, the summarized cost rate is adjusted to include the cost of reaching and maintaining a target trust fund level. A trust fund level of about 1 year’s cost is considered to be an adequate reserve for unforeseen contingencies; therefore, the targeted trust fund ratio is 100 percent of annual cost. Accordingly, the adjusted summarized cost rate is equal to the ratio of: (1) the sum of the present value of the cost during the period plus the present value of the targeted ending trust fund level to (2) the present value of the taxable payroll (or GDP) during the projection period.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005747">Summarized income rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1037201">The ratio of the present value of scheduled non-interest income to the present value of taxable payroll (or GDP) for the years in a given period, expressed as a percentage. To evaluate the financial adequacy of the program, the summarized income rate is adjusted to include asset reserves on hand at the beginning of the period. Accordingly, the adjusted summarized income rate equals the ratio of: (1) the sum of the trust fund reserve at the beginning of the period plus the present value of non-interest income during the period to (2) the present value of the taxable payroll (or GDP) for the years in the period.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1037203">Supplemental Security Income — SSI</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1039941">A Federally administered program (often with State supplementation) of cash assistance for needy aged, blind, or disabled persons. The General Fund of the Treasury funds Federal expenditures for the SSI program. The Social Security Administration administers it.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1039943">Supplementary Medical Insurance (SMI) Trust Fund</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1039946"></a>See “<span><a href="#1005832" title="I. GLOSSARY">Trust fund</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005793">Survivor benefit</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007234">Benefit payable to a survivor of a deceased worker.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043508">Sustainable solvency</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043531">Sustainable solvency for the financing of the program under a specified set of assumptions is achieved when the projected trust fund ratio is positive throughout the 75‑year projection period and is either stable or rising at the end of the period.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005794">Taxable earnings</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007254">Wages or self-employment income, in employment covered by the OASDI or HI programs, that is under the applicable annual maximum taxable limit. For 1994 and later, no maximum taxable limit applies to the HI program.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005799">Taxable payroll</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007252">A weighted sum of taxable wages and taxable self-employment income. When multiplied by the combined employee-employer payroll tax rate, taxable payroll yields the total amount of payroll taxes incurred by employees, employers, and the self-employed for work during the period.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005802">Taxable self-employment income</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007250">The maximum amount of net earnings from self-employment by an earner which, when added to any taxable wages, does not exceed the contribution and benefit base. For HI beginning in 1994, all net earnings from self-employment.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005805">Taxable wages</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007248"></a>See “<span><a href="#1005794" title="I. GLOSSARY">Taxable earnings</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005808">Taxation of benefits</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007244">Beginning in 1984, up to 50 percent of an individual’s or a couple’s OASDI benefits is potentially subject to Federal income taxation, depending on the circumstances. The revenue derived from this provision is allocated to the OASI and DI Trust Funds on the basis of the income taxes paid on the benefits from each fund. In 1994, the maximum percentage of benefits potentially subject to taxation was increased from 50 percent to 85 percent. The additional tax revenue derived from taxation of benefits in excess of 50 percent, up to 85 percent, is allocated to the HI Trust Fund.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1046431">Taxes</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1046435"></a>See “<span><a href="#1045940" title="I. GLOSSARY">Payroll tax contributions</a></span>” and “<span ><a href="#1005808" title="I. GLOSSARY">Taxation of benefits</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1046437">Termination</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1041947">Cessation of payment because the beneficiary is no longer entitled to receive a specific type of benefit. For example, benefits might terminate as a result of the death of the beneficiary, the recovery of a disabled beneficiary, or the attainment of age 18 by a child beneficiary. In some cases, an individual may cease one benefit and this is not a termination because they become immediately entitled to another type of benefit, such as the conversion of a disabled-worker beneficiary at normal retirement age to a retired-worker beneficiary.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043598">Test of long-range close actuarial balance</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048062">The conditions required to meet this test are: </a></div>
|
||
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|
||
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|
||
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|
||
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|
||
<div class="Bullet_inner"><a name="1050946">The trust fund satisfies the test of short-range financial adequacy; and </a></div>
|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
<div class="Bullet_inner"><a name="1050952">The trust fund ratio stays above zero throughout the 75-year projection period, such that benefits would be payable in a timely manner throughout the period. </a></div>
|
||
</td>
|
||
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|
||
</table>
|
||
</div>
|
||
<div class="GlossaryDefinition"><a name="1050963">The Trustees apply the test to OASI, DI, and the combined OASDI program based on the intermediate set of assumptions.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1043620">Test of short-range financial adequacy</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1043621">The conditions required to meet this test are:</a></div>
|
||
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|
||
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|
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<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
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|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1040735">If the trust fund ratio is at least 100 percent at the beginning of the 10‑year projection period, then it must remain at or above 100 percent throughout the entire projection period;</a></div>
|
||
</td>
|
||
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|
||
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|
||
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|
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|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
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|
||
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|
||
<td width="100%">
|
||
<div class="Bullet_inner"><a name="1005826">If the ratio is initially less than 100 percent, then it must reach at least 100 percent within 5 years (without reserve depletion at any time during this period) and then remain at or above 100 percent throughout the remainder of the 10-year period. </a></div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="Body"><a name="1005827">The Trustees apply the test to OASI, DI, and the combined OASDI program based on the intermediate set of assumptions.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1052617">Total-economy productivity</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1052618">The ratio of real GDP to hours worked by all workers. Also referred to as “labor productivity.”</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005828">Total fertility rate</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007264">The sum of the single-year-of-age birth rates for girls and women aged 14 through 49, where the rate for age 14 includes births to girls aged 14 and under, and the rate for age 49 includes births to women aged 49 and over. The total fertility rate may be interpreted as the average number of children that would be born to a woman if she were to experience, at each age of her life, the birth rate observed in, or assumed for, a specified year, and if she were to survive the entire childbearing period.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005832">Trust fund</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007266">Separate accounts in the United States Treasury which hold the payroll taxes received under the Federal Insurance Contributions Act and the Self-Employment Contributions Act; payroll taxes resulting from coverage of State and local government employees; any sums received under the financial interchange with the railroad retirement account; voluntary hospital and medical insurance premiums; and reimbursements or payments from the General Fund of the Treasury. As required by law, the Department of the Treasury invests funds not required to meet current expenditures in interest-bearing securities backed by the full faith and credit of the U.S. Government. The interest earned is also deposited in the trust funds.</a></div>
|
||
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|
||
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||
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|
||
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|
||
<div class="Bullet_inner" style="width: 22.464pt; white-space: nowrap">
|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
</div>
|
||
</td>
|
||
<td width="100%">
|
||
<div class="Bullet_inner"><span class="Bold"><a name="1005835">Old-Age and Survivors Insurance (OASI).</a></span> The trust fund used for paying monthly benefits to retired-worker (old-age) beneficiaries, their spouses and children, and to survivors of deceased insured workers.</div>
|
||
</td>
|
||
</tr>
|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
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|
||
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|
||
<td width="100%">
|
||
<div class="Bullet_inner"><span class="Bold"><a name="1005838">Disability Insurance (DI).</a></span> The trust fund used for paying monthly benefits to disabled-worker beneficiaries, their spouses and children, and for providing rehabilitation services to the disabled.</div>
|
||
</td>
|
||
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|
||
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|
||
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|
||
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|
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||
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|
||
<span class="Bullet_Symbol" style="list-style-type: bullet"> • </span>
|
||
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|
||
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|
||
<td width="100%">
|
||
<div class="Bullet_inner"><span class="Bold"><a name="1005841">Hospital Insurance (HI).</a></span> The Medicare trust fund that covers specified inpatient hospital services, posthospital skilled nursing care, home health services, and hospice care for aged and disabled individuals who meet the eligibility requirements. Also known as Medicare Part A.</div>
|
||
</td>
|
||
</tr>
|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
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|
||
<div class="Bullet_inner"><span class="Bold"><a name="1005844">Supplementary Medical Insurance (SMI).</a></span> The Medicare trust fund composed of the Part B Account, the Part D Account, and the Transitional Assistance Account. The Part B Account pays for a portion of the costs of physicians’ services, outpatient hospital services, and other related medical and health services for voluntarily enrolled aged and disabled individuals. The Part D Account pays private plans to provide prescription drug coverage, beginning in 2006. The Transitional Assistance Account paid for transitional assistance under the prescription drug card program in 2004 and 2005.</div>
|
||
</td>
|
||
</tr>
|
||
</table>
|
||
</div>
|
||
<div class="GlossaryDefinition"><a name="1052197">The trust funds are distinct legal entities which operate independently. Fund operations are sometimes combined on a hypothetical basis.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005847">Trust fund ratio</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1048359">A measure of trust fund adequacy. The asset reserves at the beginning of a year (equal to the reserves at the end of the prior year), which do not include advance tax transfers, expressed as a percentage of the cost for the year. The trust fund ratio represents the proportion of a year’s cost which could be paid solely with the reserves at the beginning of the year.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1060009">Trust fund reserve depletion</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1060010">The point at which reserves in a trust fund are insufficient to pay scheduled benefits in full and on time.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1059865">Trust fund reserves</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1059846">The cumulative excess of trust fund income over trust fund cost over all years to date. These reserves are held by the trust funds in the form of Treasury notes and bonds, other securities guaranteed by the Federal Government, certain Federally sponsored agency obligations, and cash.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1049360">Trustees</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1049361"></a>See “<span><a href="#1048219" title="I. GLOSSARY">Board of Trustees</a></span>.”</div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1055511">Undisbursed balances</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1055932">In general, refers to the cumulative differences between the actual cash payments for a month compared to security redemptions from the trust fund reserves made on a preliminary basis to cover such cash payments during the same month. On a monthly basis, the Social Security Administration (SSA) pays benefits and makes payments for other programmatic expenses associated with the trust funds. During each month, SSA draws cash from the trust funds on a preliminary basis, which results in Treasury redeeming invested securities to cover such payments. This monthly difference can be either positive or negative depending on net monthly activity, and is added to the balance from the end of the prior month. </a></div>
|
||
<div class="GlossaryDefinition"><a name="1055933">A net positive undisbursed balance represents a situation where cumulative redemptions from the trust fund’s securities are more than was needed to cover actual program cash payments through the end of the month. A net negative balance represents a situation where cumulative program cash payments exceeded the amount redeemed from the invested securities. A negative value requires future redemption of additional invested securities. </a></div>
|
||
<div class="GlossaryDefinition"><a name="1055504">In addition, about every seven years, when January 3 falls on a Sunday, benefit payments scheduled to be paid on January 3rd are actually paid on December 31 of the preceding year, as required by the statutory provision included in the 1977 Social Security Amendments for early delivery of benefit payments when the normal payment delivery date is a Saturday, Sunday, or legal public holiday. Consistent with practice in prior reports and for comparability with other historical years and the projections in this report, all trust fund operations and asset reserves reflect the 12 months of benefits scheduled for payment in each year. Therefore, such advance payments are included as positive values in the undisbursed balance at the end of the calendar years in which the advance payments are made.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1049365">Unfunded obligation</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1049144">A measure of the shortfall of trust fund income to fully cover program cost through a specified date after depletion of trust fund asset reserves. This measure can be expressed in present value dollars, discounted to the beginning of the valuation period, by computing the excess of the present value of the projected cost of the program through a specified date over the sum of: (1) the value of trust fund reserves at the beginning of the valuation period; and (2) the present value of the projected non-interest income of the program through a specified date, assuming scheduled tax rates and benefit levels. This measure can apply for all participants through a specified date, i.e., the open group, or be limited to a specified subgroup of participants.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1049377">Unfunded obligation ratio</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1049369">The unfunded obligation accumulated through the beginning of a year expressed as a percentage of the cost for the year.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005850">Unnegotiated check</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007272">A check which has not been cashed 6 months after the end of the month in which the check was issued. When a check has been outstanding for a year, the Department of the Treasury administratively cancels the check and reimburses the issuing trust fund separately for the amount of the check and interest for the period the check was outstanding. The appropriate trust fund also receives an interest adjustment for the time the check was outstanding if it is cashed 6 to 12 months after the month of issue. If a check is presented for payment after it has been administratively canceled, a replacement check is issued.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005853">Valuation period</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007270">A period of years which is considered as a unit for purposes of calculating the financial status of a trust fund.</a></div>
|
||
<div class="Glossaryterm"><span class="Bold"><a name="1005856">Vocational rehabilitation (VR)</a></span></div>
|
||
<div class="GlossaryDefinition"><a name="1007268">Services provided to disabled persons to help them to return to gainful employment. VR services are designed to provide an individual with the training or other services that are needed to return to work, to begin working, or to enter a new line of work. The trust funds, and the General Fund in the case of individuals also receiving Supplemental Security Income disability benefits, reimburse the providers of such services only in those cases where the services contributed to the successful rehabilitation of the beneficiaries.</a></div>
|
||
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|
||
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