Anyone use 457(b) plans for retirement savings?
Results 1 to 2 of 2
  1. #1
    Registered User Early Bird's Avatar
    Join Date
    May 2004
    Posts
    2,664
    Post Thanks / WTG / Hug
    Blog Entries
    22
    Rep Power
    16

    Default Anyone use 457(b) plans for retirement savings?

    DH works for a large university. They have recently announced that, in addition to 403(b) plans for retirement savings, they will begin to offer a 457(b).

    It looks to me as if

    * Money put into a 457(b) is tax-deferred. (You don't pay taxes on the money until you withdraw it. End result -- lower taxes in current year). Also, the earnings grow tax-free.

    * You can contribute to BOTH a 403(b) and a 457(b) in the same year. Maximum annual contribution for 2004 will be $13,000 to EACH.

    (Could you IMAGINE reducing your taxable income by $26k a year!?)

    * There is no employer match for either plan in DH's situation. Therefore, the tax break is the major benefit.

    ***************

    Anybody familiar w/ these plans? Am I interpreting the literature correctly?

    ***************
    I am taking a hard look at these. We won't be able to max out both plans at this stage in our life .... maybe someday. But it looks to me as if it'll be more worthwhile than the Roth IRAs, because the money comes out of pre-tax dollars.

    For example, IF we could invest $400 a month into the 457(b), our monthly taxes would be reduced by $90. So, it would be like taking $310 out of the budget, not $400.

    ****************
    I'll be watching as DH brings home more 457(b) literature from work. Of course, any money we invest here is in his name only, but, he comes from a family with a 0% divorce rate; that's a good sign. (Some of his siblings have been married 25 years).

  2. #2
    Registered User Kimmomo3's Avatar
    Join Date
    Mar 2002
    Location
    New Richmond, WI
    Age
    45
    Posts
    1,001
    Post Thanks / WTG / Hug
    Rep Power
    14

    Default

    Look at clark howard.com I think he has something on them not sure if it is good or bad.

Similar Threads

  1. 15% Savings for Retirement?
    By DropPass in forum Dave Ramsey
    Replies: 34
    Last Post: 02-24-2012, 12:48 PM
  2. Replies: 13
    Last Post: 03-23-2008, 05:59 PM
  3. Retirement Savings now at 15.5%!
    By nuisance26 in forum Debt Reduction & Money Management
    Replies: 8
    Last Post: 05-02-2007, 07:05 PM
  4. Retirement plans - its so cool...
    By kimmee in forum Third Agers
    Replies: 10
    Last Post: 12-12-2004, 01:53 PM
  5. What are your plans for retirement?
    By homesteadmamma in forum Third Agers
    Replies: 7
    Last Post: 04-19-2004, 07:52 AM

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •