403(b) & 457 Retirement Savings Plans

403(b) Plan

A 403(b) plan is a voluntary plan offered by public education organizations to their employees to help support employee retirement savings. Employee salary deferrals are made before income tax is paid and allowed to grow tax-deferred until the money is taxed as income when withdrawn from the plan. It is also referred as a tax-sheltered annuity.

* New* ROTH 403(b)

A ROTH 403(b) plan is a voluntary tax-advantaged retirement savings account that blends features of a ROTH IRA and a traditional 403(b). This plan allows employees to contribute with after-tax dollars. In retirement, withdrawals from a ROTH 403(b) are tax-free. Additionaly, older employees can take advantage of catch-up contributions.

457 Plan

The 457 plan is a type of deferred compensation retirement plan that is available for governmental employers. For the most part the plan operates similar to a 401k &403b, the key difference is that there is no penalty for withdrawal before the age of 59½ (subject to income tax) and separation of service.