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How to utilize a 457B plan?
Posted on 8/11/15 at 12:43 pm
Posted on 8/11/15 at 12:43 pm
My employer offers a 403B plan (I put in 6%), a 401A plan (Their contribution equals 4% of my annual salary) and they also offer a 457B plan. I also have a traditional and a Roth IRA with Vanguard that I manage myself. I actively contribute to the Vanguard Roth.
My question is what is the 457B for and how can I use it strategically?
My question is what is the 457B for and how can I use it strategically?
3
Posted on 8/11/15 at 1:18 pm to Tiger Vision
Most retirement plans have a 10% penalty if you withdraw before 59 1//2
This is one that you can withdraw early IF YOU LEAVE EMPLOYER aka terminated or retired.
Example: Teacher's opens 457 puts $5000 it grows to $7000 for 5 years. Awesome growth in investments!
She leaves because of _______.
She needs cash so she makes withdrawal it doesn't matter about her age. She left employer because of ______.
She only has to pay tax because it was tax-deferred.
She is 29. She makes withdrawal for entire $7000.
She now has $5600 to ______. 20% was held because of IRS.
She's also now on OT lounge from a website link because of ___________.
This is one that you can withdraw early IF YOU LEAVE EMPLOYER aka terminated or retired.
Example: Teacher's opens 457 puts $5000 it grows to $7000 for 5 years. Awesome growth in investments!
She leaves because of _______.
She needs cash so she makes withdrawal it doesn't matter about her age. She left employer because of ______.
She only has to pay tax because it was tax-deferred.
She is 29. She makes withdrawal for entire $7000.
She now has $5600 to ______. 20% was held because of IRS.
She's also now on OT lounge from a website link because of ___________.
Posted on 8/11/15 at 1:43 pm to Tiger Vision
The best strategy is to max it out if you can. You will: save an additional $18k pre-tax per year (on top of whatever you do with your 401/403 option), reduce your overall tax burden, and have the ability to withdraw contributions penalty-free at any time post-separation. Win, win, win
457b plans are gifts from the heavens. I wish I had one. Just watch out for high expense ratios on the funds offered
457b plans are gifts from the heavens. I wish I had one. Just watch out for high expense ratios on the funds offered
Posted on 8/11/15 at 2:12 pm to Feed Me Popeyes
quote:
457b plans are gifts from the heavens. I wish I had one.
yeah, I really wish I had one too. they are a sweet deal. I mean 36k tax free each year? Yes, please.
Posted on 8/11/15 at 9:03 pm to Tiger Vision
I max my 403b and my 457.
Since I'm over 50, it is 24K each.
It is a great deal. The only downside is limited investment choices.
Since I'm over 50, it is 24K each.
It is a great deal. The only downside is limited investment choices.
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