Realistic PRA's
(Slow Growth Scenario)

Two images from our online Social Security Solvency Simulator.

Benefits and Charts 1, side by side.
Note that Overall Benefits are scaled back to 57% of the current law schedule.
Social Security's combined employee-employer tax rate drops from 12.4% to 10%. PRA taxes are set at 2.4%.
Note Chart 1B. The Funds-to-Benefits Ratio is fairly level. (If Target Benefits were set at 58% instead of 57%, this key solvency ratio would start to decline.)
Chart 2A. PRA annuity payments start very small, but climb steadily over the decades, raising the out-year benefit total to 77%.
Chart 3A. Because PRA Annuities are paid independently, not coordinated with SS benefits, PRA Annuities are shown "above the line."

Results Page. You can use the settings on this page to recreate our results for yourself.

Note the "Benefits Actually Paid" line - $288 Trillion in SS benefits, another $74 Trillion in PRA annuities, total $362 Trillion through 2075.
Note the line "Stocks: Peak Share of Market Capitalization." PRA-owned stocks peak at 26% of the total stock market in this simulation.

Note the key assumptions:
- 50% of the PRA portfolio in stocks.
- Real GDP growth of 1.6% a year (Social Security's assumed growth rate).
- A Real ROI for stocks of 4.5% (consistent with 21st century's likely Market Cap to GDP Ratios and
   their corresponding dividend yields).
- Asset management fees of 0.5%, a third to a half of mutual fund fees. (Slightly lower fees for annuity management)
- A 50% inheritance leakage rate. When PRA owners die before retirement, some of their
   PRA funds will almost surely be converted to cash, not recycled into other PRA's.
- 0.2% of PRA assets leaking out annually for "Non-Retirement Uses," i.e. for severe family medical emergencies.
These assumptions generate a reasonable simulation of the cumulative benefits retirees would receive, 2003 - 2075.
The simulation also shows Social Security enjoying lasting solvency.

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