Marco Rubio: 5 ways to fix Social Security

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Senator Marco Rubio proposed a number of changes to the Social Security program during a speech at the National Press Club on Tuesday.

It's no secret that Social Security needs fixing in order to remain sustainable for the long-term. But lawmakers have been hesitant to touch the hot-button issue even though it's a major source of income for millions of retirees.

At a speech at the National Press Club in Washington, D.C., on Tuesday, Senator Marco Rubio took on the issue, proposing a series of changes that he said would modernize the program in light of longer life expectancies and a growing elderly population.

Currently, Social Security's trust fund is expected to run dry in 2033 -- at which point, the agency will rely on payroll taxes to fund 77% of promised benefits.

"The longer we wait to address this, the harder it will be to fix and the more disruptive those fixes will be," said the junior senator from Florida, who is believed to be a potential Republican presidential candidate.

Here are five key points from Rubio's proposal to save Social Security:

Raise the retirement age: When Social Security benefits were first doled out in 1940, a 65-year-old was expected to live another 14 years on average, according to the Social Security Administration. Today, a 65-year-old can expect to live 20 more years.

That's a much longer period of time to cover. Yet, Congress has only increased Social Security's full retirement age by two years, from 65 to 67.

Related: Are you on track for retirement?

Under Rubio's proposal, the retirement age would stay the same for workers over the age of 55. But for younger workers, he proposed gradually increasing the retirement age, though he did not provide details as to how high he would raise it.

Reduce benefits for wealthy seniors: Noting that wealthy retirees rely on Social Security for a smaller portion of their monthly finances than seniors with low incomes, Rubio proposed reducing the growth of benefits for those higher-income seniors, while "making the program even stronger for lower income seniors."

He did not provide details as to how the benefit changes would work or what income levels would be affected.

Eliminate payroll tax for older workers: Today, all workers (and their employers) are subject to a 12.4% payroll tax that is used to fund the Social Security system.

Related: Why many retired women live in poverty

Rubio proposes eliminating that tax for any workers who have reached retirement age -- a move that he said would encourage seniors who are able to keep working and help them beef up their savings.

It could also encourage employers to hire older workers, since their portion of the tax would also be eliminated, he said.

Nix the earnings test for early claimers: Under current rules, anyone who claims Social Security before their full retirement age but keeps working is subject to a "Retirement Earnings Test" that reduces benefits significantly for anyone who earns more than $15,000 a year.

The test is intended to discourage people from claiming Social Security early, but Rubio claims it can have a reverse effect and discourages seniors from staying in the workforce. He proposed nixing the test entirely.

Save a million before you retire
Save a million before you retire

Open a government savings plan to private workers: Part of fixing Social Security will rely on helping workers boost their own personal savings, Rubio said.

He proposed opening up the government's Thrift Savings Plan, a 401(k)-style plan available to federal workers (including members of Congress), to workers who do not have access to an employer-sponsored retirement plan.

"Social Security was never designed to be the sole source of retirement income. It was designed to serve as a supplement," he said. "For people in my generation and younger, this will not simply be the design of Social Security, it will be its reality."