Roadmap to Retirement: Planning with Confidence
Planning for retirement isn’t just about the numbers—it’s about preparing for a future where you feel secure, supported and free to live life on your own terms. Whether retirement is decades away or just around the corner, the steps you take now can shape what’s possible later.
At the University of Washington, you also have access to tools, benefits and events to support your financial well-being at every stage of life. We’ve partnered with Fidelity to bring you expert-backed insights and actionable strategies to help you avoid common missteps, maximize your savings and gain clarity around your retirement journey. Let’s dive in.
Define Your Destination: How Much Should You Save?
A great retirement plan starts with a clear goal. But how much is enough?
Fidelity’s rule of thumb is to aim for 10 to 15% of your pre-tax income saved annually for retirement, including any employer contributions. This may seem high, but even starting with 5% and increasing it by 1% each year can set you on the right path.
To keep you on track, Fidelity also recommends the following savings milestones:
Savings Goal by Age
30 years – 1x your annual salary saved
40 years – 3x your salary saved
50 years – 6x your salary saved
60 years – 8x your salary saved
67 years – 10x your salary saved
These are just guidelines—not hard rules. Everyone’s circumstances are different, so what matters most is getting started and staying consistent.
UW Resource: Learn more about UW’s retirement savings plans and options to explore which approach fits your goals.
Pro tip: Use automatic contributions to make saving effortless. You’re more likely to stick with your plan when it’s set on autopilot.
Choose the Right Tools: Understanding Retirement Accounts
Not all retirement savings accounts are created equal. Knowing the types available—and how they work—can help you make the most of every dollar saved.
At UW, eligible employees have access to:
UWRP (University of Washington Retirement Plan)
- A mandatory, matched retirement plan for eligible faculty and professional staff.
- UW contributes an amount equal to your own contributions (currently 100% match up to 5%).
VIP (Voluntary Investment Program)
- A supplemental plan that allows you to save even more for retirement.
- Contributions are made pre-tax or Roth (after-tax), with a wide variety of investment options through Fidelity and TIAA.
Traditional IRA
- Set-up outside UW.
- Available to anyone with earned income.
- Contributions may be tax-deductible depending on your income and whether you have a workplace plan.
- Taxes are paid on withdrawals in retirement.
Roth IRA
- Set-up outside UW.
- Funded with after-tax dollars, so withdrawals in retirement are tax-free.
- Great for those expecting to be in a higher tax bracket later.
- Income limits apply.
Health Savings Account (HSA)
- If you have a high-deductible health plan, HSAs offer a triple tax advantage: tax-deductible contributions, tax-free growth, and tax-free withdrawals for qualified health expenses.
- After age 65, you can use HSA funds for any purpose without penalty (though non-health withdrawals are taxed like a Traditional IRA).
Pro tip: Diversifying across different account types may help manage taxes in retirement.
Steer Clear of Common Pitfalls
Even a solid plan can falter without regular check-ins and adjustments. Here are a few common missteps—and how to avoid them:
Mistake #1: Delaying Your Start
The earlier you begin saving, the more time your money has to grow through compound interest. Waiting even a few years can dramatically reduce your retirement nest egg.
Mistake #2: Cashing Out Early
It can be tempting to tap your retirement funds for emergencies, but early withdrawals typically come with penalties and taxes, plus they rob your future self of growth potential.
Mistake #3: Underestimating Healthcare Costs
Healthcare is one of the largest expenses in retirement. Consider including a dedicated savings strategy, like an HSA or long-term care insurance, to offset future costs.
Mistake #4: Not Adjusting Investments Over Time
Your investment strategy should evolve as you get closer to retirement. What works in your 30s may not suit your 60s. Consider adjusting your risk exposure periodically.
Pro tip: Use Fidelity or TIAA’s retirement checkup tools in your UW portal to reassess your plan each year. Be sure to stay informed with your retirement savings!
Stay Focused on the Bigger Picture
Retirement isn’t just about money—it’s about the life you want to lead. Picture your future: What does a fulfilling retirement look like for you?
- Do you want to travel or volunteer?
- Spend time with grandkids?
- Start a second career or passion project?
- Simply relax and feel financially secure?
Whatever your vision, planning ahead helps turn your dreams into actionable goals. Retirement planning is not one-size-fits-all, and your path may include detours. What matters most is that you start planning and adjusting as you go.
Resources to Help You Get There
Both UW and Fidelity offer a wide range of tools, educational content and one-on-one consultations to support your planning journey.
You can explore:
- Retirement calculators and savings checkpoints within the Fidelity or TIAA portals
- Educational articles or webinar recordings tailored to different life stages
- Financial consultations through Fidelity and TIAA
Ready to Take the Next Step?
The future is yours to shape. Whether you’re just getting started or fine-tuning your plan, taking control of your retirement journey today can bring confidence and clarity to the years ahead.
This article is part of The Whole U’s Financial Literacy Month. Thank you to BECU and TIAA for sponsoring this signature program.