The Retirement Advice Twitter Is Lampooning

"By 35, you should have twice your salary saved, according to retirement experts," read the Twitter post that sparked a thousand memes.

Millennials, probably weary from being told off for eating too many avocados, balked at advice from Boston-based investment firm Fidelity Investments mentioned in a MarketWatch article originally published in January and promoted on Twitter on May 12. Fidelity's experts recommend that by 30, ideally one should have a year's worth of salary saved, and in five years, that amount should be doubled.

I'm legitimately not sure how someone is supposed to get a $40,000-150,000 college degree, buy a house, start a family and save twice their salary by 35.

— Ian Kenyon (@IanKenyonNFL) May 16, 2018

By 2018, your economy should produce a minimum wage of about $22/hr to equal the min wage of previous generations. https://t.co/oBYE7YtBkR

— Brian Clevinger (@bclevinger) May 14, 2018

I think you meant to say,

By 35 you should have debt twice your salary.

— From Russia with Love (@emanzi) May 14, 2018

To members of the generation coping with record high student debt, falling median earnings and living in intergenerational homes, the guideline did not seem realistic. Some believe such statements ignore larger systemic problems.

Working millennials are less likely to receive fringe benefits like health insurance and retirement plans from their employers, according to a study by the Center for Retirement Research at Boston College. The Center's study attributes the postponement of major life events by those belonging to this generation—which affects how prepared they are for retirement—to poor job market experience. (Millennials graduated into a job market where good jobs with good benefits were harder to find than for previous generations.) Among people in the U.S. earning less than $25,000, only 32% have access to employer-sponsored retirement plans and 20% participate in them according to Pew Charitable Trusts. Just 47% of workers ages 18 to 29 reported having access to a plan, compared to 63% of those 45 to 64. 

Regardless of the policy changes that need to take place and the feasibility of Fidelity's advice for everyone, financial education is crucial for young people. When it comes to investing, time really is money (see: compound interest). Since you'll have more years before retirement if you start early, you can put away a nominal amount each month to reach your target. There's also the benefit of putting away money before responsibilities and expenses pile up.

"Compound interest is especially magic when you’re young. I wish I’d known this," said Julia Kagan, Investopedia's personal finance and retirement editor. "I’ve actually said to people in their 20s especially that it’s better to start a retirement account than push to pay off your student loans extra fast."

So how much should you be saving ideally? Fidelity pegs it at 15% of your annual income every year starting at age 25 – and investing more than 50% of those savings in stocks on average over your lifetime, if you want to retire by 67.

If that scares you, you're not alone. The U.S. personal savings rate was at 3.1% in March of this year. But Fidelity says it helps to keep saving milestones in mind. “Don’t be discouraged if you aren’t at your nearest milestone. There are ways to catch up to future milestones through planning and saving,” said Adheesh Sharma, director of financial solutions for Fidelity Strategic Advisers, Inc.. “The key is to take action.”