Author Topic: 403b and 457 Retirement Plan Questions  (Read 4252 times)

lakeridge

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403b and 457 Retirement Plan Questions
« on: April 16, 2012, 04:23:30 PM »
My wife may hopefully be getting a school job which offers both a 403b and 457 retirement plan.  I've done a little searching and it looks like the great benefit is that you can contribute the 17k max to EACH plan.  It seems the withdrawl rules are more restrictive than 401's or 403's but there is no early withdrawl penalty.  Also, I believe if you contribute to a 457 you are not allowed to contribute to a Roth IRA.  I haven't found anything that talks about any problems with an existing ROTH so I assume it's ok to have as long as you don't contribute to both in the same year.   Assuming we want to contribute as much as possible to retirement accounts, does anyone know of reasons that we shouldn't max out both plans or have any additional insight into their workings.  I don't know the offerings available in each yet so don't know if the investment choices are good or if we may be limited to high fee funds or annuity products that can sometimes be the case in these types of plans.  Thanks.

arebelspy

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Re: 403b and 457 Retirement Plan Questions
« Reply #1 on: April 16, 2012, 07:50:12 PM »
Quote
Also, I believe if you contribute to a 457 you are not allowed to contribute to a Roth IRA

Source?  I don't believe that's true, or at least I've never heard it.

Yes, you can contribute to both 403b and 457b.  The 457 is better, max that first.  Depending on your age and how many years to retirement, you may want to contribute to taxable before maxing both those.
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lakeridge

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Re: 403b and 457 Retirement Plan Questions
« Reply #2 on: April 17, 2012, 10:22:35 AM »
You're correct on my Roth IRA statement- got some bad info.

arebelspy

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Re: 403b and 457 Retirement Plan Questions
« Reply #3 on: April 17, 2012, 10:44:12 AM »
Phew.  :)

I'd max the Roth and 457 before the 403 to balance some after tax and before tax savings at least a little.
I am a former teacher who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and am now settled with three kids.
If you want to know more about me, this Business Insider profile tells the story pretty well.
I (rarely) blog at AdventuringAlong.com. Check out the Now page to see what I'm up to currently.