Saving for Retirement

No one can predict the future.  That is why saving for retirement is so complicated.  As members of PERSI, State of Idaho employees are in an enviable position in our retirement planning strategy.  However, there are several options above and beyond our PERSI 401(k) that can help us save for our retirement years.  Let’s look at some strategies and products we can use to boost our retirement savings.


  • Set a goal. Determine how you want to live out your retirement years.  Do you want to travel the world or stay home and tend to your garden?  How much money will you need to accomplish these goals?  A popular rule of thumb is to plan to have savings of about 25 times your expected annual expenses.  At retirement you can withdraw 4% each year to live comfortably.  Remember that commuting expenses will go down, but healthcare related expenses may go up.
  • Use a retirement calculator. There are several comprehensive retirement calculators available online by reputable investment companies.
  • Start early. The benefit of compound interest means that any interest you earn is added to the base savings amount and new interest is earned on top of that.  Over time, this is a powerful way to save for retirement.  Plan to contribute at least 10% of your gross earnings to whichever savings plan you choose.
  • Automate. Set up automatic contributions to your retirement savings plan to support your goals.  You do not need to think about it, it is already done!
  • Delay claiming Social Security benefits as you near retirement age. For each year you wait (until age 70), your benefit will increase.


  • Traditional IRA: Your money is not taxed at the time you contribute it.  This means that your full contribution earns interest.  Your income must be under $124,000 annually to qualify.  The contribution limit is $6000 per year, unless you are over 50 at which time the limit increases to $7000.  You can begin drawing funds when you reach 59 ½ years old, and you must start drawing at age 72.
  • Roth IRA: Your money is taxed up front.  This allows you to not pay taxes during your retirement years.  The income limit is the same as the traditional IRA, however you can make partial contributions if your salary is under $139,000.  If the account has been open at least five years, you can begin withdrawals at age 59 ½, but there is a 10% penalty if you choose to withdraw earlier.  There are no minimum withdrawals required.

Traditional and Roth IRA requirements do change, so be sure to research each option fully before signing on the dotted line.  Also, a traditional IRA can be converted to a Roth.  Evaluate your mindset and don’t let your short-term goals derail you from your long-term goals.  To learn how to keep your hard earned savings safe and avoid fraud, refer to the valuable resources on the Idaho Commission on Aging’s website.

Return to Your Key to Successful Aging