A 457(b) plan is a deferred
compensation plan that’s often made available to eligible employees in the public
sector and not-for-profit sectors. It operates much the same as a 403(b) and
401(k) with respect to salary deferrals, contribution limits, investment
options, and so on.
Those with both a 403(b) and 457(b)
have an advantage over the rest of us. They’re allowed to max-out contributions
to both plans. For
2015, that’s $18,000 x 2 = $36,000. The age 50+ crowd is also eligible for the
age-related catch-up of $6,000, for total maximum contributions to both plans
of $48,000. A pretty sweet opportunity for those who have it!
The 457(b) has some other differences...unlike the 401(k), 403(b), and IRAs, withdrawals (“distributions”)
from the 457(b) plan before age 59.5 are taxable but don't trigger the federal penalty
Hope that helps.
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