403B? A? 401K? What's the difference?

[Kookaburra]

I've been living on about 50% of my take home income for awhile, but I recently ran across the MMM blog when trying to figure out what to do with it beyond hoarding it in my savings account. It's really hard for me to even put money from my checking into my savings, because I was riding the ragged edge of financial disaster for so long, and there's always a little voice in my head saying, but what if you NEED THE MONEY RIGHT NOW?!?! When I squirrel it away in a savings account.

Anyways - my only debt is about 25K in student loans, and I've been making minimum payments on those (but if I understand MMM correctly, I should start paying as much as I can because that will be a better long term strategy, even over investing?)

My employer does not offer 401K, but they do have 403A and B. The B has matching up to 4% if you put 10% of your income in (which I do.) What's the difference between the 401K and 403A/B? I've tried to figure it out, but all of the financial stuff goes right over my head. Can I get a 401K alone, without going through my employer? Would I be better off with some other sort of retirement savings? I don't even know what my options are, and after the 2008 crash, I'm leery of going to investment firms that are just going to bet against me.

[arebelspy]

Start with an emergency fund, if that helps you sleep at night.

403A is an annuity.  You want the 403b.  It's like a 401k, but usually done by nonprofits. Most don't have matches, so count yourself lucky.  At least invest enough to get the match, that's basically a free 40% return on your money (4% match on 10% contribution).

Paying down the student loans depends on what interest rate you're at.

If you can, contribute to a Roth IRA (you'd start yourself) as well.

Here's the order I'd go in, if I were you:
1) Build cash level to comfort level
2) Contribute minimum to get full match on 403b
3) Max Roth
4) Max 403b

If student loan debt is above 6% or so, stick that in at #3, otherwise continue to pay the minimum (IMO.. others will lower that percent to somewhere between 3 and 6).

[Kookaburra]

Thanks! You're right, I work for a non-profit hospital. :) I'll have to check my student loan rate...I consolidated it last year through the federal direct loan program, and halved my interest rate, but I don't remember what the new rate was. Mostly I was just concentrating on getting out from under Sallie Mae's thumb.

[fiveoh]

Is your name for the silver coin or actual animal?  :)

Be careful of the 403B.  My wife has the option for that as well.(although no matching for her)  There have been some companies ripping people off on fees etc in these.  Make sure you do your research and see where your money is going and what fees you are paying etc. 

[Kookaburra]

It's the animal, or at least the children's song. :)

Right now my money is just going into whatever the default stocks are.

[Kookaburra]

If student loan debt is above 6% or so, stick that in at #3, otherwise continue to pay the minimum (IMO.. others will lower that percent to somewhere between 3 and 6).

I just checked it, my rate is at 4.75%.

[arebelspy]

If student loan debt is above 6% or so, stick that in at #3, otherwise continue to pay the minimum (IMO.. others will lower that percent to somewhere between 3 and 6).

I just checked it, my rate is at 4.75%.

That's probably borderline for most people.  I would pay the minimums, others would pay that down before investing.

Your call if you stick that in at #3 or #5 in the plan I outlined above.