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For many UCLA students going into the work force, social security may not be a big issue.

But a reform proposal made by President Bush could allow young workers to put part of the payments they make to the Social Security system into a personal investment fund instead.

“Younger workers should have the opportunity to build a nest egg by saving part of their Social Security taxes in a personal retirement account,” Bush said in his State of the Union address on Jan. 20.

The proposal was part of a program unveiled last year known as the Progressive Personal Account Plan.

To the employed with retirement in a very distant future, the plan will allow for more personal freedom and wealth, said Berna Brannon, a social security analyst at the Cato Institute.

Those who choose to participate in the PPAP will be able to privately invest a part of their wages into an individual account, like a bank account.

“(The plan) would ultimately improve Social Security’s viability, as well as improve the personal accountability of the system,” Brannon said.

From their bank account, individuals can use the limited investment options offered or the wider array of investment options if they keep their balance above a minimum figure.

According to the Institute for Policy Innovation, employees who choose this option will contribute an average of 6.4 percent of their pay to a personal account.

Another approximate 6 percent will be used to pay transition costs and fund disability and survivor benefits.

Critics of the upcoming budget plan argue that instead of cutting taxes the Bush administration should cut spending.

“The tax cuts should be stopped, and military spending should be cut to decrease the deficit,” said Bryan Ellickson, an economics professor at UCLA.

With a generation of baby boomers approaching retiring age in the next decade, an increase in national savings needs to occur quickly.

Mitchell said personal savings with 401k plans and Individual Retirement Account plans instituted by many corporations may help bear the burden of an increased need for Social Security.

But plans developed so far by the Bush administration, including the PPAP, do not move toward cutting the deficit, Mitchell said; they merely transfer money from one pocket to another.

Other critics of the PPAP state that individuals choosing to have their own personal accounts will run the risk of dropping their “nest egg” through stocks.

The current Social Security system spreads this risk out over a few generations, so all individuals have a financial security net no matter what happens.

“The personal accounts are the issue of those who do not like Social Security as a collective system, who just want to make the system more personal,” Mitchell said.

But Timothy Penny and Leanne Abdnor, members of the pro-reform For Our Grandchildren organization, said the benefits of personal retirement accounts will help all American people by promoting ownership and fairness, and helping women and people with shorter life expectancies.

They expect the program to bring more comfortable retirements because workers would have personal funds available when they choose to retire.

Claiming that in many cases Social Security discriminates against women, For Our Grandchildren holds that with personal accounts, women can make sure they have enough funds available when they retire.