Having twice your income saved by 35 is not obnoxious

When I was 20 I no longer worked a jobby-job with the State. So I needed to roll my retirement account savings into a new account. I found Jim Fleming nearby and we’ve been loyal to each other ever since.

During our initial conversation, I asked Jim, “How much money should I be saving each month to have a comfortable retirement?”

“That depends on a few factors. Let’s run some numbers based off when you’re 60, 65, and 70 years old,” he said.

He flipped his computer screen around and said, “These numbers assume that Social Security will exist in some form as it does today, with some modest increases in inflation.”

The numbers for what my annual retirement outlays were around $60,000 inflation-adjusted dollars per year. Keep in mind, my reported income the first year I started my business in earnest was $17,000.

“How much should I be saving then, of my own money, each month?” I asked again, driving at the real number.

Without so much as a stutter: “About $300-$350 a month”. That, on top of what we hoped would remain of Social Security, was what I needed to be saving each month.

I didn’t hit that goal at 20 years of age and $17,000 a month. Yet when I started my business I made room for retirement savings. “Let’s start with $50 a month,” I said.

That, coupled with my rollover money from the State was a start. If you’re curious, I think my retirement savings at that point amounted to around $4,000.

Each year Jim would call to check in and each year or two I would bump the amount of money I was saving by $25 or $50. An extra $25 a month wasn’t noticeable to me. I had expenses under control. I took the risk of foregoing college when I couldn’t pay out of pocket anymore so I never had loans. I got rid of my car. I lived in a modest house in the city, but at a low rate and rented out a spare bedroom. On any given month I could pay for utilities, insurance (pre-Obamacare), groceries, and some small business expenses on about $650 a month. For a while I didn’t use a cell phone, instead opting for an iPod Touch and Skype calls over WiFi. I ate a lot of tuna sandwiches in 2010.

Last year I set a life goal to get to that magic $300 a month number. I hit that in March. Looking at my retirement funds, I have a healthy amount of money in there. I’m fortunate to be able to say that. I get that some people don’t have that luxury. In fact, a lot of people don’t.

For ten years I have harped on anyone who is leaving college to “immediately start saving something, anything, for retirement.” I usually get dumb looks. I might as well be telling my friends they should hop on one leg from now until they’re 65.

The Twitter story about having twice your annual salary saved by 35 struck people as obnoxious and rude*. I don’t think it is. I think it’s math. Some people are naturally stuck in a terrible spot because they had to go to college to get a decent career. Others are there because they didn’t do the work earlier to prepare and drive a $20,000 car.

Like hours in a day, we (everyone using Twitter anyway) have some level of income. It sounds preachy, but this has to be a priority. We can’t even assume Social Security is going to be there for us.

Don’t blame education. I didn’t know any more or less than any other 19 or 20-year-old. No one is surprised to find out they get old and things cost money.

The savings advice is not rude or obnoxious. It’s not even unrealistic. It is possible, just like losing 100 pounds is possible for a 300-pound person. Don’t lament it or mock that math. Assess and take action.

* What’s obnoxious and rude is the jackass that said millennials don’t own homes because we spend it all on avocado toast.