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Subject:  Re: 403b vs. 401k Date:  3/19/1998  10:11 AM
Author:  TMFPixy Number:  2258 of 88775


<<As always, I learn something when I read your messages. Would you please expand on your explanation of "catch up" contributions to a 403b? My wife, a teacher, has taught for 7 consecutive years, but didn't start her 403b until 4 years ago. How can she "catch up?" on the missing 3 years?>>

These are far too complex to explain in a concise fashion. There are three methods that can be used, and they are mutually exclusive. Use one, and the other two can't be used. One allows the employee to use the full exclusion allowance up to $30K, but may only be used if the employee has ten years of service and is terminating employment. The second is limited to employees with 15 years of service, so it doesn't apply in your wife's case. The third affects everybody in the plan, requires an employer' approval, and has other sometimes unpleasant ramifications to participants other than the one trying to use the "catch up" provisions.

Your best bet is to have your wife see her benefits administrator to see how and when the earlier years when she didn't contribute can be made whole.


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