## Provisions Affecting Trust Fund Investment in Marketable Securities

These provisions invest a portion of the Social Security trust funds in marketable securities (e.g., equities, corporate bonds), rather than in special-issue government bonds as under current law. We provide a summary list of all options (printer-friendly PDF version) in this category. For each provision listed below, we provide an estimate of the financial effect on the OASDI program over the long-range period (the next 75 years) and for the 75th year. In addition, we provide graphs and detailed single year tables. We base all estimates on the intermediate assumptions described in the 2023 Trustees Report.

The selections G3, G5, and G7 provide a low-yield or risk-adjusted perspective where equity yields equal the average real yield on long-term Treasury bonds. Thus, these selections have no effect on the actuarial balance of the OASDI program. Many analysts believe the higher expected return for equities should not be included in valuations because the tendency for higher average returns is compensation for the higher volatility in equities. The low or risk-adjusted yield assumption reflects this perspective.

Choose the type of estimates (summary or detailed) from the list of provisions.

Number | Table and graph selection |
---|---|

G1 |
Invest 40 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2024-2038), assuming an ultimate 5.8 percent annual real
rate of return on equities.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |

G2 |
Invest 40 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2024-2038), assuming an ultimate 4.8 percent annual real
rate of return on equities.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |

G3 |
Invest 40 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2024-2038), assuming an ultimate 2.3 percent annual real
rate of return on equities. Thus, the ultimate rate of return on equities
is the same as that assumed for Trust Fund bonds.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |

G4 |
Invest 15 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2024-2033), assuming an ultimate 5.8 percent annual real
rate of return on equities.
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |

G5 |
Invest 15 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2024-2033), assuming an ultimate 2.3 percent annual real
rate of return on equities. Thus, the ultimate rate of return on equities
is the same as that assumed for Trust Fund bonds.
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |

G6 |
Invest 25 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2026-2035), assuming an ultimate 5.8 percent annual real
rate of return on equities.
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |

G7 |
Invest 25 percent of the OASI and DI Trust Fund reserves in equities
(phased in 2026-2035), assuming an ultimate 2.3 percent annual real
rate of return on equities. Thus, the ultimate rate of return on equities
is the same as that assumed for Trust Fund bonds.
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |