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Analysis of the Issues Involved in Securing Constant Replacement Rates in the Social Security OASDI (Old-Age, Survivors and Disability Insurance) Program

机译:分析社会保障OasDI(老年,幸存者和残疾保险)计划中确保持续替代率的相关问题

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The paper reviews the way that Social Security benefit levels are determined, focusing on how each worker's past earnings are averaged to obtain an Average Monthly Wage figure and on how this figure is converted into a primary benefit or PIA when it is multiplied through the PIA computational formula. The degree to which future benefit levels and future payroll tax rates are dependent on future rates of increase in wages and prices is discussed. The concept of the replacement rate is introduced and is defined as the ratio of a person's initial Social Security benefit to come measure of his average earnings prior to retirement. The manner by which the present benefit computation system responds to changes in wage and price levels is examined, and ways that an alternative benefit computation system might be constructed are explored. Finally, suggestions for calculating the average monthly wage, so that it correctly adjusts the initial benefit awards of those persons who will retire in the future are offered.

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