Washington seems determined to ignore the country’s rapidly worsening fiscal picture, but sooner or later, policymakers will be forced to pay attention. When they do, they’ll find that changes to Social Security are unavoidable.

No doubt, any such effort will meet strong political resistance. That’s why nothing has been done for 40 years and counting. The best approach – on the merits and as a matter of political feasibility – would combine entitlement reform with fresh thinking about financial security in retirement.

Thanks to relentless pressure from an aging population, Social Security is expected to exhaust its financial reserves in 2033. At that point, without offsetting action, benefits will automatically be cut by a quarter.

The program’s last big overhaul, in 1983, scheduled a gradual rise in the normal retirement age from 65 to the current 67. Life expectancy will increase further over the coming decades, and longer retirements will continue to raise costs. Indexing the normal retirement age to longevity (meaning a constant ratio of years in retirement to years in work) would imply a normal retirement age of 69 by 2075. This would close about 40% of the long-term fiscal shortfall. The rest could come from higher revenue – for example, through raising the income cap on payroll tax above the current $160,200.

While some combination of lower spending and higher revenue is necessary, it’s true that a higher retirement age will weigh more heavily on lower-wage workers. At present, workers can choose to retire on a reduced benefit as soon as age 62, and many do. Early retirees may be dealing with poor health or quitting physically demanding jobs, and life expectancy is lower among the poor. So the needed fiscal reforms should be combined with steps to improve financial security in retirement, especially for the low-paid.

The best way to do this would be to ensure that all workers are enrolled in a supplementary retirement-savings account. The government could direct that employers deposit, say, 3% of each worker’s earnings in a new universal account unless the worker opts out. It could also encourage low-wage workers to participate by matching their contributions, covering the cost of this subsidy by curbing the tax benefits granted to holders of existing retirement accounts – benefits that flow almost entirely to the highest-income workers.

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The Thrift Savings Plan for federal workers is a possible model. It emphasizes low costs and maximum simplicity. Participants’ contributions vest immediately; the government’s match vests over time. By default, the plan allocates funds between safe and risky pools of assets according to each member’s years remaining in work. Participants can override those choices if they wish and spread their investments across a range of approved alternatives. On retirement, balances can be converted to annuities with protection against inflation.

The U.K.’s successful National Employment Savings Trust, known as Nest, works along similar lines.

A universal scheme in the U.S. would supplement Social Security and help workers, especially those on low incomes, enjoy a decent standard of living in retirement. By encouraging people who don’t save much to put away more, it would also most likely boost savings and investment in the aggregate. By reducing the misdirected subsidies in the existing mishmash of investment tax shelters, it could be made revenue-neutral, all while improving the prospects for pulling Social Security back toward solvency.

It’s ambitious, no doubt. Any plan to mend Social Security without hurting the least well-off will have to be. Whether it’s lasting reform or a temporary patch, the time for finding the remedy is fast running out.

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