A voluntary carve-out private account is an account to which workers may voluntarily divert part of their payroll tax contributions from Social Security. Participants in a carve out would receive reduced Social Security benefits at retirement in exchange for having diverted part of their Social Security contributions to a private account. The Social Security Administration (SSA) would calculate the reduction in Social Security benefits using the device of a hypothetical account. That account would be "credited" with an amount equal to the actual contributions made by the person to the private account and with a predetermined interest rate on its hypothetical balance. At retirement, the hypothetical balance resulting from the crediting of contributions and interest would be converted into a hypothetical annuity using a life table reflecting current life expectancy at retirement. The annuitized monthly benefit calculated for the hypothetical account would be subtracted from the Social Security monthly benefit that the retiree would have received if not contributing to the private account. The retiree would receive the reduced Social Security benefit resulting from this subtraction, plus the proceeds from the private account.