Actuarial Balance

Can you take a wild guess as to what this term means? No, it’s not how well you did on that field sobriety test that you thankfully passed last weekend. As noted by Investing School, actuarial balance refers to the state of Social Security. It’s a means of determining how much money Social Security has to hand out right now, verses how much it will have down the road. If these figures are balanced, actuarial balance exits.

This figure is based on a whopping sixty-six time frames (valuation periods), beginning with predictions over the next decade. The end result is a prediction for 75 years. If the necessary numbers do not line up, actuarial balance has not been achieved. (And yes, you should worry about this.)