(FORTUNE Magazine) – Frustrated by Americans' disinclination to save? Perhaps Washington's wonks should look south, way south, for a solution. One after another, countries in Latin America are employing a radical measure to raise savings and rescue their ailing social security systems: They're privatizing them. The new plans replace traditional government-tended social security systems with something akin to a mandatory individual retirement account (IRA). Like Social Security in the U.S., the new plans include compulsory payroll deductions, but rather than going into government coffers these funds are deposited in individual accounts, which each person controls. The performance ! of these funds determines what each person receives in retirement. The first of these plans started up in Chile in 1981. At first, the money could only be invested in government bonds. But gradually the regulators permitted investment in bonds, and finally Chilean stocks. The Chilean savings funds, now increasing by $200 million a month, are credited with raising the national savings rate by about one-third. Across the Andes, Argentina is readying a similar savings reform plan for launch in 1994. Mexico is also pondering a switch.