457(b) Deferred Compensation Plans
Eligible for government employers. These plans are a valuable employee benefit that allows tax-deferred savings for retirement. First year implementation is free
We work with dozens of local governments, police & fire districts, public libraries, and school corporations across the state of Indiana.
FAQs
What are the withdrawal rules?
On a 457(b) plans, there is never a 10% penalty like there may be in an IRA or 401(k). The money is eligible for withdrawal upon separation of service, or attainment of age 59 and a half, whichever comes first. Other ways to get to the money include hardships and loans. These are rules of thumb, and rules differ based on your 457(b) plans documents.
How do 457(b) plans differ from 401(k) plans.
Only governmental entities are eligible for 457 plans, while 401k plans are for for-profit companies. 457 plans enjoy benefits that 401k plans do not have. For example, 457 plans are liquid after separation of service, while 401k plan money is not liquid until attainment of age 59 and a half. Many of the differences in these plans lie in the administration of the plans, and the two plans are similar for the participants.
What is the purpose of a 457(b) plan?
Because the majority of participants in a 457 plan have a pension, the purpose of the 457 is to bridge the gap between what your current income is, and what your pension income will be. Schedule an appointment below to learn how a 457 fits into your retirement.
What should I do with my 457(b) plans when I retire?
Since the 457(b) plan is still subject to employer rules, it often makes sense to rollover the 457 plan into an IRA. This way, access to the money is less restricted and you are not subject to fees associated with the 457. If this is something you’d like to do, please schedule an appointment below!