Whilst The United Kingdom in the 1980’s we were governed by a party which had The Iron Lady as it’s leader, Germany a hundred years previously had their own “Iron leader”

Otto Von Bismark (who’s moniker was the iron chancellor) and Margaret Thatcher had a lot in common.

They were both pretty conservative, they both spent decent periods of time in the top job and they were both known for being massively strong willed (hence the ‘iron’ bit).

However there was one action Bismark took in his time in control of Germany which I couldn’t imagine Thatcher would have considered implementing (if it hadn’t been in place in the UK already)..

He established the worlds first welfare state.

It’s surprising that as such a conservative Bismark made this decision. However there are a number of reasons behind such a bold move.

Firstly he wanted to politically trump some of his left leaning rivals who at the time theorised about such policies but didn’t have the power to implement. By taking this approach and implementing legislation he was seen as a reformer.

Secondly, he wanted to garner support from “the workers” of Germany.

and

Thirdly he wanted to stem the mass emigration of German workers to America (a tactic which stemmed this emigration massively)

All of this could have been quite expensive on the state….however Bismarck was a canny fella.

The ‘state pension’ element of the reforms (which also included sickness and accident protection) provided a pension annuity to anyone who reached the grand ‘ole age of 70 and covered all types of workers from the start.

Whilst 70 is still relatively young now…Bismark knew one thing.

Life expectancy at the time, in Germany in the late 19th century, was less than seventy!

Therefore the move was a political masterstroke (offering state pensions for swathes of the population was a vote winner) but didn’t have as much of a massive liability on the state at the time.

After Germany implemented it’s own welfare state the United Kingdom quickly followed with the 1908 old age pensions act, the introduction of free school meals in 1909, the introduction of Job Centers (although the term Labour exchanges was used) in the same year and then the introduction of national insurance in 1911

Most people would argue that protecting and supporting members of our society through a welfare state is one of the most honorable things a modern society can do.

I’d absolutely agree with this.

However the role of the state when it comes to looking after people in retirement has changed.

This is due to a number of factors however a change in one aspect of our lives has impacted this change more than any other…

We now live way longer, and way healthier than we ever did before.

This has meant a greater burden on the state pension system and one of the reasons that for the responsibility for saving has been moving (and will continue for some time) away from the state and onto us as individuals.

However there’s also been another change…

The way many of us perceive ‘work’ and ‘retirement’ is fundamentally different.

Retirement used to be perceived as a fixed point of time when you stop work. In reality ‘retirement’ now usually includes some form of work be it paid, voluntary, charitable or something else.

Retirement used to be supported heavily by a state pension. In reality it’s now about individuals taking control of their own financial lives and saving slowly and consistently over time.

and

Retirement used to be about pensions. Now, and especially with the greater freedoms in the pensions systems it’s about something more important than that.

To be frank retirement in whatever form it comes has always been more than pensions.

Pensions are one of the vehicles people can use to get to their destination.

However the important thing is where we’re going not how we get there, as long as the “how we get there” is relatively effective, but that we achieve our goal.

The goal in question?

Financial Freedom.

Aspiring  to be financially free gives us unique choices.

It allows us to do what we want with our lives.

It enables us to achieve something more important than the vehicle we use to achieve a far more precious goal…

How we choose to spend our time.

Achieving financial freedom as a way to achieve the ultimate freedom of how we spend every day, ever hour and every second of our we spend our time doesn’t start with a pension, an investment or savings account.

So, although Bismarck started the journey towards the modern welfare state which has bought made many modern societies fairer, healthier and more equitable societies the reality for most of us has changed.

Retirement is now not about the state, or a fixed point of time.

It’s now about taking control of our own future and moving towards an intentional life where financial freedom enables freedom in a far more aspect of our lives

Time.

However financial freedom rarely happens accidentally. For anyone trying to get to this point they need to start with something fundamental. It starts with identifying what if you’d truly love to do if you could spend every single day doing something you love.

It starts with a manifesto.