Author Topic: 457 plan  (Read 2323 times)

Returnoftheyeti

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457 plan
« on: May 18, 2015, 09:14:49 AM »
Can anyone provide some links to some detailed, accurate information on the pros and cons of a 457 plan.

I have seen crap like this:  http://money.cnn.com/retirement/guide/401k_457plans.moneymag/

But I was hoping for something more detailed, and comparing it to a 401k, should I max it out if I can't  afford to max out both?  Should I max out a 401k  and a 457?, or invest some of that 36k somewhere else?

mikesinWV

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Re: 457 plan
« Reply #1 on: May 18, 2015, 09:23:38 AM »
Absolutely nothing wrong with a 457 plan--as the article states, it's a defined contribution plan for state and local government employees. 

What really matters is what does the plan offer?  What funds, costs, etc.  Same thing for the 401k.  Also, are there matches available for either? 

I think you need to post more information.

DrF

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Re: 457 plan
« Reply #2 on: May 18, 2015, 10:08:11 AM »

Returnoftheyeti

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Re: 457 plan
« Reply #3 on: May 18, 2015, 10:16:58 AM »

MKinVA

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Re: 457 plan
« Reply #4 on: May 18, 2015, 10:40:40 AM »
Yeti, the big differences between the two are who (government employees versus private sector employees) and with a 457, you can take the money (earnings) prior to 59 1/2 if you retire from that governmental entity prior to that age. Also, the "match" is usually nominal and has to be put into a separate plan (see 403b).

seattlecyclone

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Re: 457 plan
« Reply #5 on: May 18, 2015, 10:48:17 AM »
The 457 is great in that you can take the money out penalty-free at any age without going through any special gymnastics like the Roth conversion pipeline. That said, if the fund options are a lot worse in your 457 plan you may want to max out the 401(k) first.

ChaseJuggler

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Re: 457 plan
« Reply #6 on: May 18, 2015, 10:58:23 AM »
I was so mad that it took me 5 years of teaching to even HEAR about what a 457 was. As far as I can tell, it's in every way superior to a 401k.

dandarc

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Re: 457 plan
« Reply #7 on: May 18, 2015, 11:01:19 AM »
Be sure that it is a governmental 457 - the non-governmental 457 plan is not as good a deal due to the assets not being held in trust for you.  If the non-governmental entity gets goes bankrupt or something, the 457 assets could disappear.