5 myths about Social Security (3) by Liz Pollium Weston

Life expectancy and disappearing assets

Myth No.3: Age 65 was picked as the retirement age because when Social Security was started in the 1930s, most people were dead by then. The average life expectancy for a baby girl born in 1935 was about 63 years. For a baby boy, it was about 59 years.

But those statistics reflect the higher infant and child mortality rates of the times. If you survived childhood, you had a good shot of living beyond retirement age. Men who lived to age 30 in 1935 could expect to last another 37 years. Women at 30 had a 40-year average life expectancy.

If you actually reached retirement age, your prospects for a relatively long retirement were good. Men who were 65 in 1935 could expect to live another 12 years, while women faced an average 13 more years. (Today, men of the same age can expect to live another 16 years, and women 19 years.)

In fact, about half of the 30 state pension plans that existed in 1935, and many of the private pension plans, used 65 as a retirement age. Most of the others used age 70. Social Security's creators thought 65 was the more reasonable age and believed the system could be self-sustaining if they chose that age.