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PERSI Retirement Rules: How to Plan for a Secure and Comfortable Retirement

Admin • January 5, 2024

The Public Employee Retirement System of Idaho (PERSI) is a retirement plan for public employees of Idaho, made up of members from over 850 employer organizations across the state. The $22 billion plan offers retirement, disability, and death benefit programs to over 177,000 members. In 2022, over $1 billion in benefits were paid to PERSI retirees living in Idaho, with an average monthly benefit of $1,800. 

Whether you’re a new public employee just entering PERSI, or you’re nearing retirement and thinking about your future, understanding PERSI’s retirement rules can help you in your retirement planning. Having a comprehensive plan that includes your PERSI benefits can lay the foundation for a secure and comfortable retirement in your golden years. 

Understanding PERSI Basics

PERSI was founded in 1963 as a defined benefit retirement plan to offer a measure of retirement security for Idaho’s public employees. Through the plan, retirees receive a fixed monthly pension based on factors including years of service and salary. 

During its first 35 years, PERSI’s plan was a traditional defined benefit plan, now known as the PERSI Base Plan ; in 2001, PERSI added a defined contribution plan, called the PERSI Choice 401(k) Plan , to supplement the Base Plan. 

  • Base Plan : Enrollment in the defined benefit Base Plan is automatic, and once vested, you’ll receive a lifetime benefit at retirement. Both you and your employer make contributions to the Base Plan, which are invested and grow over time. Your contributions go into your personal account, while employer contributions are pooled in a trust fund to cover future benefits for all members. 

For 2023, as a general member, you contribute 6.71% of your annual salary to the Base Plan, and your employer contributes 11.18%. This percentage varies if you are a public safety member or a school employee member, and it will increase for all members in 2024. Retiring as a vested member means you’ll receive a fixed monthly payment for the rest of your life.

  • Choice 401(k) Plan : Participation in the defined contribution Choice 401(k) Plan is voluntary, unlike the Base Plan. The Choice 401(k) Plan allows you to contribute a portion of your salary, pre-tax, via payroll deductions. You can direct your investments among several investment options. The amount available in your Choice 401(k) at retirement is dependent on your contributions and the performance of your investments.

The combination of these two plans from PERSI offers an optimal blend – the security of the Base Plan, and the opportunity for self-directed investments and voluntary contributions in the Choice 401(k) Plan.

PERSI Eligibility and Retirement Rules

Understanding how to join PERSI and what it means for your retirement is paramount for utilizing this helpful benefit and resource. 

Joining PERSI

When you work in an eligible position for one of over 850 PERSI employers, you become a PERSI member. As an eligible employee, you accrue service credit for each month you work; the credited service is used to calculate your PERSI benefit at retirement. You’ll earn one month of service for each calendar month worked, with at least 20 hours worked during a week. You won’t earn additional service credit by working overtime.

Once you’ve earned 60 months of service credit, you’ll be considered vested and receive a lifetime benefit at retirement. The five-month vesting period doesn’t need to be with the same PERSI employer – you can change public service jobs without impacting your PERSI membership.

Planning for Retirement

To receive your full PERSI retirement benefits, you must reach your service retirement age; or, you must meet the minimum age requirement when you retire, have at least 60 months of credited service, and you also must meet the Rule of 80/90 . These requirements differ if you are a general member, or public safety member – police officer or firefighter.

The Rule of 80/90 = your age + your years of service = 80/90 (or more)

For general members, you must be at least 55 years old and meet the Rule of 90. For police officers or firefighters, you must be 50 years old and meet the Rule of 80. For members with mixed service, your requirements depend on your ratio of general and police-firefighter service –  you’ll have to be between 50-55 years old and meet a Rule of 80 or 90, with both depending on your ratio.

If you retire before reaching your service retirement age (65 years old for general members, 60 years old for police and firefighters), or before reaching the Rule of 80/90, your retirement benefit will be reduced.

If you decide to work beyond your service retirement age or the Rule of 80/90, your retirement benefit will continue to increase.

Calculating Your PERSI Retirement Benefits

Determining the amount of your PERSI retirement benefits and how much income you’ll receive can help you better plan for retirement. PERSI benefits are calculated using a straightforward formula involving your average monthly salary during a Base Period (currently 42 months), a multiplier of 2% for general members or 2.3% for police officers and firefighters, and your months of service.

Average Monthly Salary during Base Period  x Multiplier x Months of Service

For example, if you’re a general member, your average monthly salary is $3,000, and you have 360 months of service:

$3000 x 2% x 360 months = $21,600 

÷ 12 months = 

Monthly benefit of $1,800

The value of your PERSI benefits typically far exceeds your contributions – within the first 3-5 years of retirement, most PERSI members have received a return greater than the money they contributed while working. And you’ll continue to receive your benefits payment for the rest of your life. PERSI also considers cost-of-living adjustments (COLAs) to Base Plan benefit payments annually. Your PERSI benefits are a guaranteed, long-term source of retirement income – something very difficult to find in another investment.

Planning for Retirement with PERSI

There are several retirement distribution options available for PERSI members to choose from. The Regular Retirement option provides the largest benefit, with full payment throughout your life, but it has no Contingent Annuitant (CA) protection for your spouse or dependents. PERSI offers two CA Allowance retirement distribution options with either 100% or 50% CA allowances, as well as a Social Security Adjustment option and two options that are a CA/Social Security blend.

If you’re planning on retiring in the next few years, or even if you’re years away from retirement, knowing how the PERSI retirement process works can help make it more efficient and seamless. PERSI provides a helpful retirement checklist to follow throughout your career as a guide.

Comprehensive Retirement Planning

A comprehensive retirement plan that includes income and investments beyond your PERSI Base Plan and Choice 401(k) Plan will offer you more opportunities to save for retirement and reach your financial objectives. Your goals for retirement are based on your unique situation, and working with a financial advisor can help you create a retirement plan that is customized to your individual circumstances, risk tolerance, timeline, and objectives.  

At Five Pine Wealth Management , we work with you to develop a financial plan and retirement plan that is tailored to your specific needs. As fiduciary financial advisors , we have your best interests in mind as we help you reach your retirement goals and realize your vision of retirement. To find out more about how we can help you supplement your PERSI retirement plan with other retirement strategies, send us an email or give us a call at: 877.333.1015.

40 and Catching Up: Why This Decade Could Be Your Best for Building Wealth

July 18, 2025
Your 40s arrive with a unique mix of clarity and urgency. You've likely figured out what you want from life, but suddenly retirement no longer feels like a distant concept. If you're looking at your financial situation and feeling behind, you're not alone. Many people in their 40s experience this same wake-up call. The good news is that this decade offers some of the most powerful opportunities to accelerate your wealth-building journey. Think of your 40s as your financial prime time. You're earning more than you ever have, you understand money better than in your 20s and 30s, and you still have 20-25 years to let compound growth work its magic. Instead of dwelling on what you should have done differently, let's focus on what you can do right now to make this decade count. The Reality Check: Where You Stand vs. Where You Want to Be Before exploring strategies, let's acknowledge the elephant in the room. Many financial experts recommend saving three times your annual salary by age 40. If you're reading this and thinking, "I'm nowhere near that," take a deep breath. Life happens. Maybe you started your career later, switched fields, dealt with medical expenses, helped family members, or simply prioritized other goals during your 30s. The key is to start from where you are today, not where you think you should be. Your 40s bring unique advantages: higher earning potential, greater financial discipline, and often more stable life circumstances. Many successful investors didn't hit their stride until their 40s or later. You're not behind; you're just getting started on a more intentional path. Retirement Savings Strategies That Work in Your 40s Your retirement savings strategy in your 40s should differ from someone in their 20s or 30s. You have less time but more resources, which means you need to be both aggressive and smart about your approach. First, maximize your employer's 401(k) match if you haven't already. This is free money, and missing out on it is like leaving cash on the table. Additionally, consider increasing your contribution rate by 1-2% each year, or whenever you receive a raise. This gradual approach makes the adjustment less painful while significantly boosting your long-term savings. Roth conversions become particularly powerful in your 40s. If you expect to be in a higher tax bracket in retirement or if you want to leave tax-free money to heirs, converting some traditional IRA or 401(k) funds to Roth accounts can be a smart move. The key is to do this strategically, perhaps in years when your income is temporarily lower or when you can manage the tax impact. Don't overlook the power of diversification beyond your 401(k). A taxable investment account gives you flexibility and access to your money before age 59½ without penalties. This can be crucial for achieving early retirement goals or covering major expenses that may arise before the traditional retirement age. Catch-Up Retirement Contributions: Start the Habit Now Once you reach 50, you can make catch-up contributions to your retirement accounts, which significantly increases your savings potential. For 2025, this means an additional $7,500 in 401(k) contributions (bringing your total to $31,000). However, you don't have to wait until 50 to think like someone making catch-up contributions. Start now by treating your savings rate as if you're already eligible for these higher limits. If you can save an extra $600 per month ($7,200 annually) starting at 45, you'll have built the habit by the time you're actually eligible for catch-up contributions. Retirement Milestones by Age 40: A New Perspective Traditional retirement milestones can be discouraging if you're starting later or if life hasn’t gone as planned. Instead of focusing on arbitrary multiples of your salary, consider these more practical benchmarks for your 40s: The Emergency Fund Foundation : Before aggressively pursuing retirement savings, ensure you have a solid emergency fund in place. This prevents you from having to tap retirement accounts during tough times. Aim for 3-6 months of expenses, adjusted for your specific situation. The Debt Freedom Focus : High-interest debt can quickly derail retirement plans. If you're carrying credit card debt or other high-interest obligations, addressing these might be more valuable than maximizing retirement contributions beyond your employer match. The Income Replacement Goal : Rather than focusing on net worth multiples, think about what percentage of your current income you're on track to replace in retirement. A good target is 70-80% of your pre-retirement income, but this depends on your lifestyle and retirement plans. The Flexibility Buffer : Your 40s are a great time to build financial flexibility. This means having investments outside of retirement accounts that you can access without penalties, creating multiple income streams, and maintaining career skills that keep you marketable. Insurance: Life and disability insurance coverage should reflect your current income and family needs. Estate Planning : A basic will, power of attorney, and healthcare directive should be in place. Making Your Peak Earning Years Count Your 40s often represent your peak earning years, and how you manage this increased income will significantly impact your financial future. The temptation to inflate your lifestyle with every raise is real, but this decade calls for more strategic thinking. Consider implementing a "pay yourself first" approach where you immediately redirect any income increases to savings and investments. If you get a $5,000 raise, automatically increase your 401(k) contribution by $3,000 and your taxable investment account by $2,000. You'll barely notice the difference in your take-home pay, but you will thank yourself in the future. This is also the time to think seriously about additional income streams. Whether it's consulting in your field, starting a side business, or investing in rental real estate, diversifying your income sources provides security and potential for acceleration. Building Wealth Beyond Retirement Accounts While retirement accounts are crucial, they shouldn't be your only wealth-building tool. Your 40s are an excellent time to diversify your investment approach and build wealth that's accessible before traditional retirement age. Consider opening a taxable investment account if you haven't already done so. This provides flexibility and liquidity while still offering growth potential. Focus on tax-efficient investments, such as index funds, and consider holding dividend-paying stocks or REITs for their income potential. Real estate can be particularly powerful in your 40s. Whether it's paying off your primary residence early, investing in rental properties, or exploring REITs, real estate adds diversification and potential inflation protection to your portfolio. Don’t Forget the “You” Factor We’d be remiss not to mention this: life in your 40s is busy. You might be managing aging parents, teenagers, or a toddler (or all three). You may be helping your partner through a career change or navigating one yourself. It’s a lot. Which is precisely why intentional financial planning matters now more than ever. You don’t need to do it perfectly. You just need a plan that’s rooted in your real life — your values, your vision, and your goals. A good financial advisor can help you prioritize, simplify, and clarify the next best steps, even if you feel like you’ve fallen behind. Ready to Create Your Personal Financial Strategy? Feeling overwhelmed by all the options and strategies available? You don't have to navigate this journey alone. At Five Pine Wealth Management , we specialize in helping individuals and families in their 40s and beyond create comprehensive financial plans that align with their goals and circumstances. Whether you're looking to maximize your retirement savings, explore catch-up strategies, or build a diversified investment portfolio, our team can help you develop a personalized approach tailored to your situation. We work with clients at various stages of their financial journey, from those just getting serious about retirement planning to those with substantial assets seeking to optimize their strategies. Don't let another year pass wondering if you're on the right track. Schedule a conversation with our team to discuss your financial goals and explore how we can help you make the most of your financial prime time.

The Best Long-Term Investment Strategy? Stay Invested, Stay Calm

June 20, 2025
When markets are calm, investing can feel easy. You contribute regularly, watch your portfolio grow, and start picturing that future vacation home or early retirement. But when markets get volatile, everything changes. Suddenly, headlines are full of dire warnings. Account balances fluctuate. And the urge to do something can feel overwhelming. At Five Pine Wealth Management , we understand how emotional investing can become during periods of market uncertainty. One of the most important things we do as fiduciary financial planners is to help our clients stay grounded when the market gets choppy. Let’s walk you through how we approach investment risk management and why having a clear, disciplined philosophy matters most when volatility strikes. Our Philosophy: Think Long-Term, Not Next Week When markets are moving fast, it is easy to think that the “best long-term investment strategy” must involve taking action to avoid losses or chase gains. The reality is usually the opposite. Reacting to market noise can often do more harm than good. In fact, one of the greatest risks to long-term returns is making emotional decisions in response to short-term events. We coach our clients to stay focused on their long-term financial plans and goals. Volatility is a feature of markets, not a flaw. By designing portfolios with realistic expectations for ups and downs, we help clients stay invested through all market environments. Here is what this looks like in practice: We use broadly diversified portfolios built around low-cost ETFs. We focus on asset allocation aligned with your time horizon, goals, and risk tolerance. We do not chase trends or attempt to time the market. We regularly review and rebalance portfolios based on your financial plan, not headlines. In short, your portfolio is designed to ride out volatility, not avoid it entirely. Fiduciary Financial Planning: Advice in Your Best Interest There is a great deal of noise in the financial world, particularly during turbulent market conditions. One of the most significant ways we help cut through it is by being fiduciary financial planners. That means we are legally and ethically obligated to act in your best interest at all times. We are also fee-only advisors. We do not receive commissions for recommending one investment over another. Our primary agenda is to help you reach your goals. During market volatility, this matters more than ever. Too many investors fall prey to sales pitches disguised as “solutions” to market risk. We focus on education and long-term planning rather than quick fixes. Being a fiduciary allows us to focus on what serves you best: Keeping you aligned with your personal goals and values Helping you tune out market noise and media hype Offering sound, research-backed guidance without conflicts of interest Your Coach Through Emotional Market Cycles One of our most important roles as financial planners is helping clients manage the psychological side of investing. It is one thing to know, intellectually, that markets will recover over time. It is another thing to watch your portfolio drop 15% and not feel anxious. Market downturns create powerful emotions. Fear. Doubt. Sometimes, even panic. As humans, our instinct is to take action to relieve those feelings, even when the logical course is to stay invested. That is where we come in. We help coach clients through these moments so they can avoid costly mistakes like: Selling during a downturn and locking in losses Chasing the next hot trend during a rebound Over-concentration in “safe” assets out of fear We remind clients that volatility is a normal part of the market. Markets have experienced recessions, wars, pandemics, and political turmoil before. They will again. Over time, markets have historically rewarded patient investors who stayed the course. When you work with us, you gain a trusted partner who is here to talk through your concerns, offer perspective, and help you make decisions that serve your long-term goals. Why Staying the Course Actually Works It may seem counterintuitive, but reducing activity during market volatility often yields better outcomes. Consider this: From 1999 through 2018, if an investor missed just the 10 best days in the S&P 500, their overall return would have been cut nearly in half . Many of the best market days happen very close to the worst ones. Trying to time the market is a challenging task, even for seasoned professionals. By maintaining a disciplined investment approach and staying fully invested, you ensure that you are there for both the recoveries and the long-term growth that markets provide. Our role is to help you build a portfolio designed for precisely this kind of staying power. We structure your investment mix to help you weather market cycles without having to guess what will happen next. Educating Clients About Normal Market Cycles Another key aspect of fiduciary financial planning is helping clients understand what is “normal” in the market. Volatility is not a sign that something is broken. It is a natural part of how markets function. In fact, without volatility, markets would not offer the returns that make long-term investing so powerful. We work with clients to help them see: Why some years will be down, but others will be very strong Why trying to avoid all losses is neither realistic nor necessary How staying invested through cycles often leads to far better outcomes than jumping in and out of the market Perspective is everything . The more you understand market behavior, the less likely you are to make emotional decisions during downturns. Different Stages, Same Principles Our approach also adapts to the varying needs of clients at different stages of their financial journey. For clients in their 40s to 60s: We may focus on prudently preserving and growing wealth. We help manage sequence-of-returns risk as you approach retirement. We may emphasize income planning and portfolio sustainability. We ensure that your investment mix aligns with your evolving goals and risk tolerance. For clients in their 30s: We provide education about typical market cycles (especially if this is their first experience with volatility). We coach clients to take advantage of their longer time horizons. We help younger investors see downturns as buying opportunities, not threats. In all cases, we are committed to helping clients invest with confidence, regardless of the headlines. Ready to Build a More Resilient Investment Strategy? Market volatility will always be part of investing, but it doesn't have to derail your financial goals. As your trusted financial advisor Coeur d'Alene team, we're here to help you navigate market uncertainty with confidence through our comprehensive financial planning approach. Contact Five Pine Wealth Management today to discuss how our investment philosophy and comprehensive financial planning approach can help you navigate market uncertainty with confidence. To see how we can help you support your financial goals, send us an email or call us at 877.333.1015.  Whether you're looking to preserve the wealth you've already accumulated or build a foundation for long-term growth, our team has the experience and commitment to help you stay focused on what matters most: achieving your financial goals.