Age 65 holds special significance in many countries around the world. This age is often associated with retirement and eligibility for pensions and healthcare benefits aimed at seniors. There are several reasons why age 65 has taken on this meaning:
Origin of Age 65 as Full Retirement Age
The age of 65 as the milestone for retirement originated in Germany in the late 19th century under Chancellor Otto von Bismarck. As part of his social welfare programs, Bismarck set 65 as the age for collecting a pension. This was picked somewhat arbitrarily based on actuarial tables that showed most people did not reach that age. Bismarck wanted to offer benefits to the elderly without actually having to pay too many people.
Other European nations followed suit in the early 20th century, adopting 65 as the official retirement age. In 1935, when the United States passed the Social Security Act under President Franklin D. Roosevelt, 65 was chosen as the age to be eligible for pensions. Once again, it was based on mortality tables showing 65 year olds were unlikely to live much longer.
So the age of 65 took hold around the world as the milestone age for retirement and pension eligibility purely for economic reasons, not because of any scientific basis. Nonetheless, most countries stuck with age 65 in their social welfare programs as they developed over the 20th century.
Age 65 as Full Retirement Age for Social Security
In the United States, turning 65 remains significant since it is considered the “full retirement age” for collecting unreduced Social Security retirement benefits. Specifically:
- For people born in 1937 or earlier, their full retirement age is 65.
- For people born in 1938 to 1942, their full retirement age ranges from 65 and 2 months to 65 and 10 months.
- For people born 1943 to 1954, their full retirement age is 66.
- For people born 1955 to 1960 and later, their full retirement age gradually increases from 66 and 2 months to 67.
Retiring at 65 in the U.S. ensures people can collect their maximum possible Social Security benefit. Retiring earlier than one’s full retirement age results in permanently reduced benefits. However, the significance of 65 has been declining as full retirement age rises for younger generations.
Age 65 for Medicare Eligibility
Another reason age 65 remains relevant today in the U.S. is that it is the age of eligibility for Medicare. Created in 1965 alongside Medicaid, this federal health insurance program covers Americans aged 65 and older, regardless of income or medical history.
Turning 65 allows people to enroll in Medicare if they choose to. This provides guaranteed access to health insurance for seniors. Most people do not have access to affordable health insurance without an employer-sponsored plan, so Medicare fills that gap at 65.
When Age 65 is Not the Retirement Age
While 65 holds significance in the U.S., other countries have different retirement ages for pensions and benefits:
| Country | Official Retirement Age |
|---|---|
| China | 60 for men, 50 for female civil servants and blue-collar workers |
| France | 62 |
| Russia | 60 for men, 55 for women |
| India | 60 |
| Mexico | 65 |
| Japan | 65 |
| Nigeria | 60 |
| Denmark | 65 |
| Singapore | 62 |
| Israel | 67 for men, 62 for women |
Some countries are increasing their retirement ages due to longer life expectancies. For example, the retirement age in Germany will go from 65 to 67 by 2029. The United Kingdom is increasing its state pension age from 65 to 68 between 2026 and 2046.
On the other hand, Russia has a lower retirement age to account for shorter life spans. Retirement ages for men and women also vary in some countries like China and Israel.
Early Retirement Ages Around the World
Many countries also allow early retirement several years before the official retirement age, usually with reduced benefits. Here are some early retirement ages:
| Country | Early Retirement Age |
|---|---|
| France | Up to 2 years before normal retirement age |
| Germany | 63 |
| Greece | 62 |
| Slovenia | 63 for men, 61 for women |
| Denmark | 60 |
| Sweden | 61 |
| Canada | 60-64 depending on years worked |
| Brazil | 60 for men, 55 for women |
| Nigeria | 50 |
| Kenya | 50 |
Workers need to meet certain conditions like length of employment to qualify for early retirement. The benefits are reduced compared to retiring later. Workers need to decide if the tradeoff is worth retiring sooner with a smaller pension amount.
Trends Toward Delayed Retirement
While 65 has traditionally been seen as the retirement age in many places, trends in the past couple decades show people working longer:
- In 1985, 29% of Americans ages 65 and older were still working. By 2016, that percentage nearly doubled to 46%.
- 78% of Americans plan to continue working after retirement, mostly part-time. 61% say they work after retirement for health benefits.
- A 2021 survey showed 60% of U.S. workers expect to retire after age 65 or not at all, up from 50% five years ago.
- In the late 1990s, about 80-85% of men aged 55-59 were still working. That percentage rose to 87% by 2016.
There are several reasons more people are delaying retirement compared to previous generations:
People Living Longer
Life expectancies have increased significantly in developed countries. Someone who retires at 65 today can expect to live 15-20 more years on average. People are staying healthier later into life compared to decades ago. This enables more people to work past traditional retirement ages.
Financial Reasons
Many workers cite financial reasons for delaying retirement. Specifically:
- Pensions have become less common. In the U.S., only 23% of workers have a traditional pension, compared to 38% in 1995.
- Lower interest rates have made it harder to accumulate retirement savings.
- Inadequate retirement savings force about 33-50% of American workers to keep working longer.
- Working longer increases Social Security benefits. Each additional year of work up to age 70 results in an 8% increase in annual SS income.
- More workers face debt like mortgages and college loans in old age that require extra income.
Basically, the shift away from employer pensions plus longer lives have made retirement more expensive. Working longer helps close the financial gap.
Few Mandatory Retirement Ages
In the past, many companies had set retirement ages of usually 65. The default was employees automatically retiring at that point. However, age-based mandatory retirement has been largely banned in the U.S. Age discrimination laws require employers to make decisions based on individual performance, not age.
Without forced retirement, workers can decide if they want to keep working. Most change to part-time roles. The lack of mandatory retirement gives more flexibility.
Desire for Purpose and Fulfillment
For some older workers, continuing to work gives a sense of purpose. Surveys show the social interactions, friendships, and feeling of usefulness provided at work are big reasons retirees return to the workforce. Many seek “bridge jobs” that provide fulfillment without as much stress.
Conclusion
While 65 is seen as a milestone age for retirement in many countries, its significance has declined over time. Longer life spans, inadequate retirement savings, bans on mandatory retirement ages, and a desire to keep active have led to a trend toward delayed retirement. However, age 65 remains an important eligibility age for social welfare benefits. The future may see retirement ages increase to reflect longer lives. But for now, age 65 still roughly marks the transition from work to retirement.
