TD Fall Investing GuideTD Fall Investing Guide
Fri, 22 Feb 2013 15:30:00 GMT | By Deirdre McMurdy, MSN Money

Plan to retire at 66? Think again

Like many other expectations, the idea of an automatic withdrawal from work is receding fast.

Deirdre McMurdy

By all accounts — and there are plenty of them — Otto von Bismarck (who was considered the founder of the German Empire) was not a nurturing, warm-hearted kind of guy. After all, you don’t go down in history as the “Iron Chancellor” for nothing. And then there’s the small matter of the spiked helmet he was so fond of wearing in official portraits.

That said, Count von Bismarck is widely considered to be the father of modern social security. He also gets credit for establishing the first formal retirement age for workers along with the pensions that provided them with a stipend to ensure for what passed as comfort in 1884.

Although he himself was 74 at the time, Bismarck initially set the retirement age at 70 (it wasn’t changed to 65 until 1916). His motivation was practical and political rather than compassionate (he was attempting to stave off the encroachment of Germany’s Socialist Party). But he also understood that relatively few people at that time lived to 70 anyway — so projected pension costs were no real concern.

However cynical, Bismarck’s plan was considerably more humane than the one proposed two years earlier by British novelist Anthony Trollope, in his dystopian novel The Fixed Period.

Set in the far distant future of the 1980s, it was the story of a government that agrees to terminate the lives of all citizens at age 68 to spare them any undignified suffering and to keep them from burdening the state as unproductive beings. (They were granted a year of contemplative retirement before being chloroformed and cremated.)

Of course, the whole notion of social security and retirement didn’t fully migrate to North America until the Depression era, when the need to get young people back to work meant easing out the older ones more efficiently.

Since then, the expectation for consecutive generations has been that they work until 65, spend a few years playing canasta in Florida or lurching around the continent in an RV, spend a few more years in a retirement home and, well, that’s the end of that.

Like so many other long-held expectations, however, the notion of automatic retirement — even at the recently extended age of 66 — has been turned on its ear by a new reality.

For one thing, people are living healthy, active lives much longer than they have at any other point in history. For another, technology has made the physical requirements of most jobs far less demanding.

Scroll upScroll down

Recently recommended stories