What Was Retirement Like Before Social Security

What Was Retirement Like Before Social Security

Many conclude that retirement before Social Security was horrible, but was it?

For nearly 250 years during colonial times, on the frontier, and until the late 1890s, families made their living in rural farm communities.

The family unit was self-reliant and self-sufficient. They did not rely on others for their livelihood.

Times were tough, but there was a sense of community.

Then, a period of rapid growth came to  America. The country became industrialized.

This was a significant development because it ushered in a new era with new attitudes.

Attitudes about how to earn a living changed. It’s that change in attitude that ultimately made the difference between what retirement was like before Social Security and after Social Security.

Attitudes about how to earn a living expanded beyond the farm.

By 1920, the census showed more people living in towns and cities than in rural farm communities. This is notable because this is when people started buying their living instead of making it.

Individuals gave up their independence and relied on others for their support and security.

That security came in the form of a paycheck.

There is a fundamental difference between making your living and buying your living.

Each method affects what retirement is like for an older person.

Let’s take a look at what that means.

People measured security in the early days by making their own living.

Colonial Times -Rebel Retirement
 A primitive cotton factory in Alabama – weaving homespun for the family. – circa 1896

Before the Industrial Revolution, people measured security by what they could provide for themselves, exclusive of money. Families didn’t depend on outside authority for their livelihood or subsistence.

They were self-sufficient-rugged individuals that lived off of the land on farms and homesteads. They lived off-the-grid long before the lifestyle became popular in the 20th century.

Everyone was responsible for producing most of what they required and desired.

They built their own homes, hunted for wild game, grew their own crops, made their own clothing, and taught their children.

Except on occasion when they afforded themselves a few luxuries like tea or fine furniture, very little was acquired by paying for it with money.

Several generations lived under one roof and all family members contributed to the sustainability of the family.

When children grew up, they took over certain responsibilities from the older folks. Yet, all remained accountable for a share of the work.

No one actually retired.

The matriarchs and patriarchs of the family remained useful by helping with various household chores.

For example, Grandma and Grandpa might trap small animals for food for the table.

Additionally, elders might mend, sew, or make soap or candles.

They often cooked or provided assistance with other necessary tasks.

Clearly, it was hard work but all had a roof over their heads and food on the table.

Families and communities took care of one another through thick and thin.

The (social) security of the times was in self-investment which resulted in the cycle of parents caring for children, then children caring for parents, and so on.

This generational model worked for hundreds of years until the late 1800s when America became industrialized.

Although mechanization brought about many improvements to the quality of life,  the resulting prosperity had huge ramifications on the nation and rural America in particular.

Industrialization changed what retirement would eventually look like.

What effect did industrialization have on retirement?

Asahel Curtis [Public domain]
Looking east from 3rd Ave. Federal Building, right, 3rd Ave. and Union St.; White Building, right in distance, southeast corner o Union St. and 4th Ave – 1909

As the nation saw rapid industrial growth, farm life and caring for extended family and community was no longer the norm.

Machines made farm work more efficient – thereby eliminating much of the work that once required physical strength. Therefore, not as many hands were needed on the farm.

Younger men started migrating to cities to look for work.  Indeed many former farmhands became the workers who built America’s cities and railroads.

Manufacturing was at an all-time high. As a result, everything imaginable became available for sale.

Consequently, it became convenient to purchase goods and services instead of making it yourself.

People continued to flock to cities.

As factories produced more goods for people to buy,  it became necessary to hire people to manufacture and sell those goods.

Accordingly, people continued to flock to the cities.

The nation was at full employment. It was a boom time for the cities.

Literally, millions of men and women found work as salespeople, whether in the wholesale or retail sector.

Others found employment as stenographers, clerks, cashiers, or telephone and telegraph operators.

Many became stockbrokers, accountants, and bankers.

For the first time in America, more people lived in cities, than in rural communities. That’s when people began buying their living.

Industrialization changed the face of what retirement was like before Social Security by changing the way that people secured their lives.

People quit making their living and started buying it.

Goods and services were readily available in the 1920s.

People were busy with jobs working for others and didn’t have the time or inclination to make what they needed.

But they were well paid and had the money to buy what they wanted.

It was convenient to purchase goods and services that families in earlier times would have made for themselves.

Necessities like food, clothing, and shelter were purchased instead of being made by family and community.

Livelihoods were different.

Not only were people securing their necessities by buying them, multiple generations no longer lived under one roof.

There was a cultural shift in what security meant. It was a stark contrast than in the early days of self-sufficiency and helping one another.

In addition, people decided to invest (or gamble, depending on how you look at it) their money in the stock market instead of hiding it under the mattress.

When the Great Depression hit, this reliance on others for employment, goods, and services resulted in great suffering for millions of people, and particularly the older generation.

The Great Depression Brings Poverty to the Elderly

Waiting_for_relief_checks_during_Great_depression- Rebel Retirement
Waiting for relief checks during the Depression

Although industrialization brought prosperity to the country, it also brought different attitudes about who was responsible for the aging population.

And, it was never more apparent than in the Great Depression.

Gone were the days of making one’s living. Millions were dependent on jobs for their security.

When the stock market crashed and people lost their jobs and all of their money, a dark cloud of poverty enveloped the nation.

The elderly, retirees, and those close to retirement who saw their savings disappear, suffered greatly. If they were sick or unable to restore their savings, they became dependent on their children.

Although some states had old age assistance programs, the full responsibility of elder care was left up to their children. In fact, it was required by law that they do so.

However, children had their own suffering. They wanted relief from the burden of taking care of their parents.

They were desperate for help. Essentially, it was the children of the elderly that wanted some kind of federal intervention.

One of the bleakest times in history for old people.

Quote from Social Security, 1937

“Old people, like children, have lost much of their economic value to a household. Most American families no longer live in houses where one can build on a room or a wing to shelter aging parents and aunts and uncles and cousins. They no longer have gardens, sewing rooms, and big kitchens where old people can help make the family’s living. Old people were not dependent upon their relatives when there was need in a household for work they could do. They have become dependent since their room and their board cost money, while they have little to give in return. Now they need money of their own to keep the dignity and independence they had when their share in work was the equivalent in money.” (Social Security, 1937)

There was no security for older people because the times had stripped them of their value. The consensus was that they had little worth.

Before and After the Crash

Long before industrialization and the stock market crash of 1929, it was understood that families would take care of one another and not depend on the government for help.

Older people felt useful throughout their lives as they contributed to their family’s livelihood.

Then, the world changed. Industrialization brought prosperity, yet it also brought a change in attitudes in how one would earn a living.

This resulted in lifestyles revolving around money, instead of self-sufficiency. Hence, people no longer had the independence of the past.

When the economy crashed in 1929, many people were terribly unprepared for what to do without a paycheck.

After the Social Security Act was signed in 1935, it relieved the poverty-stricken and dependence on children.

However, it meant that people began to rely on others instead of themselves. So although Social Security was the salvation for seniors, it also made our society a little less caring for our elders.


The fundamental difference between making a living and buying a living is simple. Making a living is independent of others.

Individuals provide for themselves by producing what they require, resulting in security throughout retirement. Buying a living depends on others for support and security – it involves money.

In the early years of our nation, multi-generations lived under one roof.  All were expected to provide value and support to the family. Families and communities supported one another from childhood through old age. That was the security of the times.

Industrialization brought opportunity and wealth, but it also eroded that security.

Then during the depression, elders went from people with value to impoverished individuals dependent on their children and others for support.

Surely, times have changed. And I don’t know of anyone that wants to depend on their children for financial help in their old age.

With that said, live debt free, be in charge of your health, and be self-reliant.

Sources: Why Social Security, Senior Living.org
Banner and featured image by: Annie Spratt on Unsplash
Last updated: 04/05/2021

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