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Author: czbill12 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76418  
Subject: Main differences between 401(a) and 457(b)? Date: 8/13/2014 5:36 PM
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Hi,
doing some research, but does anyone have insight into these vehicles? I'm used to the std 401K, and am changing companies....thanks. I know there are contribution limits, etc.
Cheers,
czbill
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Author: intercst Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 75505 of 76418
Subject: Re: Main differences between 401(a) and 457(b)? Date: 8/13/2014 7:02 PM
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Here's 401(k) vs. 457(b)
https://www.fascore.com/PDF/SouthCarolina/planCompare.pdf

and 401(k) vs. 401(a)
http://budgeting.thenest.com/401a-different-401k-22125.html

intercst

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Author: czbill12 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 75506 of 76418
Subject: Re: Main differences between 401(a) and 457(b)? Date: 8/13/2014 7:28 PM
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thanks...will check these out. Also found some items with city of Phoenix.

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Author: BruceCM Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 75511 of 76418
Subject: Re: Main differences between 401(a) and 457(b)? Date: 8/15/2014 11:40 AM
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czbill
Sounds like you will work for a government employer.

Sec. 401(a) is really not a retirement plan...its a set of rules that all qualified plans must follow. Governments do not offer ERISA-regulated qualified plans, but they often follow some of the rules outlined in Sec. 401(a). Generally, so-called 401(a) plans are contributed to by the employer, based on salary, years of service or some measure of the employer's profitability. They can be fixed annual contributions or may vary year to year. Government plans may require employee contributions, so these may not be elective to the government employee.

the 403(b) is the non-qualified version of the qualified 401(k) offered by private employers (note: with the exception of some grandfathered plans, governments may not offer 401(k) plans after May 1986). It may be offered by governments and non-profit employers.

There are two types of 457(b) plans: those offered by a government employer and those offered by a non-profit employer. For government employees, it generally will allow full 402(g) annual contributions (17,500 for 2014), generally does not include any employer contributions, and because it is technically a deferred comp plan, this contribution maximum may be in ADDITION to the 17,500 maximum contribution that may be made to a 403(b) or any other salary deferral plan the employee may have participated in for that year. Unlike other retirement plans (including traditional IRAs), there is no pre-59.5 10% early withdrawal penalty.

What is not to like about 457(b) plans is they are often expensive. They are often administered by insurance companies, who are masterful at extracting fees, fees and more fees...and because 457(b) plans do not fall under the recently added full fee and expense disclosure laws, these 457(b) fees are often very difficult to find. The negative effect of high fees can be substantial over one's working years.

BruceM

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