Here's What Experts Say It Will Take to Fix Social Security

The Social Security Board of Trustees expects the program to become insolvent in the next decade, which would result in a sizable cut to benefits. Those who count on Social Security to pay bills are naturally anxious. They want to know if someone is actively working on a solution, and if so, what that solution may be.

To learn what experts suggest, I turned to studies by the nonpartisan researchers at The Brookings Institution. Scholars at this American think tank claim their proposed blueprint for Old-Age, Survivors, and Disability Insurance (OASDI), also known as Social Security, would virtually achieve solvency for OASDI over a 75-year period.

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What experts suggest

• Increase the maximum wages subject to Social Security taxes: Currently, taxpayers must only pay Social Security taxes on the first $176,100 they earn (an amount that changes annually with inflation). This proposal would slowly increase the total wages taxed until it eventually covers 90% of earnings.
• Change the rules for pass-through payroll tax: The current rules governing self-employment earnings vary, depending on whether they're classified as employment earnings (which are subject to Social Security taxes) or investments (which are not). This proposal would dramatically tighten that loophole.
• Increase payroll tax: The current OASDI payroll tax is 12.4% on wages with the employer and the employee each paying half. This proposal would increase that amount to 12.6%.
• Increase retirement age for high earners: Because research indicates that high earners live longer than others, the full retirement age for those earning the top two-fifths of wages would slowly increase until it reaches 70 in 2054.
• Change how average indexed monthly earnings are calculated: Rather than determine benefits by relying on the highest 35 years of earnings, this proposal would change it to 40 years.
• Tax all benefits of high earners: Social Security recipients are typically taxed on half or 85% of their benefits, depending on their income. This proposal would tax 100% of Social Security benefits received by single people with an adjusted gross income (AGI) over $100,000 and couples with an AGI over $125,000.
• End the dependent retiree spouse benefit: Currently, a spouse who is at least 62 or cares for a child under 16 is eligible to receive up to half of their partner's monthly benefit. This proposal lowers the benefit gradually until it disappears in 2037. The new policy would not apply to disabled or surviving spouses.
  
• Eliminate child retiree benefits: As of 2025, children of a retired parent are entitled to up to 50% of their parent's benefits if their parent is still alive and 75% if the parent has died. This proposal would end the benefit for everyone except disabled or adopted children or those cared for by grandparents.
• Increase survivor benefits: Under current policy, a survivor can choose to receive the larger of their own benefits or the Social Security benefits their deceased spouse had been receiving. The new policy would allow the surviving spouse the option of receiving 75% of their combined benefits instead.
• Create a disability benefit for older workers: A new Early Retirement Disability benefit would cover people aged 58 or older who are not healthy enough to work but are unable to qualify for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI).
• Restore and expand student benefit: For children whose parents are disabled or have died, this plan would provide benefits to full-time students through age 25, regardless of their marital status or the type of education they're pursuing.
• Provide a child benefit to relatives caring for children: Benefit eligibility would be loosened for grandparents or other eligible relatives of the same generation who have custody of a child for at least six months a year.
• Improve benefits for disabled adult children: Unlike the current policy, a disabled adult child with a qualifying physical or mental impairment would no longer need to be unmarried or have developed the disability before reaching adulthood.
• Build up the OASDI trust fund: This proposal would ensure that all taxes collected on Social Security benefits are dedicated solely to the OASDI trust fund.
• Change immigration policies: By increasing the number of immigrants to the U.S. who can legally work here and pay into the Social Security system, more money would be available to pay benefits to current recipients.
• Include workers outside the Social Security system: State and local government employees are typically insured by alternate public pension plans and don't pay into Social Security. Under this proposal, beginning in 2032, all newly hired state and local government employees would become part of the Social Security system instead, helping increase the number of people paying into the program.

While this framework exists, passing new Social Security legislation is no easy feat. Lawmakers are hesitant to touch the program as any cuts to benefits are sure to leave many of their constituents unhappy, even if those cuts are necessary in the long run.

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