457b

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anbuitachi

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Anyone here put in money in 457b? my non gov institution offers 457b, for another 19k pretax contribution but since its much higher risk than 403b, i'm debating whether i should do it.. any advice? Any of you have 457b offered but chose not to use? And why?

Im still in my 30s so i have ways to go before i can withdraw without penalty, and ways to go so higher risk of hospital collapsing as well.. On the other hand, it is pretax contribution of 19k, which helps since i live in one of the highest taxed spots in US. Currently only maxing out 403b.
 
You have tax consequences should u decide to leave ur non state/govt 457b institution. Cause u will have trouble rolling it over.

My advice is the tax deductions are not worth with if it’s not a true 100% owned state/city/govt facility.

When I was in academics I had access to 457b and i contributed to it. But i also worked at 100% state facility being state public employee so I have options available when I left.
 
anbuitachi said:
Anyone here put in money in 457b? my non gov institution offers 457b, for another 19k pretax contribution but since its much higher risk than 403b, i'm debating whether i should do it.. any advice? Any of you have 457b offered but chose not to use? And why?

Im still in my 30s so i have ways to go before i can withdraw without penalty, and ways to go so higher risk of hospital collapsing as well.. On the other hand, it is pretax contribution of 19k, which helps since i live in one of the highest taxed spots in US. Currently only maxing out 403b.
Click to expand...

Debated this one before (and continue to).

Pros are the tax savings, tax deferred growth, my plan has good investment options, and it’s a possible source of income in event of early retirement.

Cons are limited distribution options and the chance of the balance being 0.

My health system is strong today but that may mean nothing tomorrow. I’m also in my 30s and figured that I’d contribute now while my risk tolerance is high, and probably pare back or stop in a few years. Maybe I’ll have a little extra money in the end, or maybe I’ll lose some, but not so much that I wouldn’t be able to recover.
 
You’ve all enlightened me to a huge flaw in my retirement plan. I didn’t understand that my community hospital owned my 457b and if they became insolvent I would lose my money. The extra 19k of tax shelter was a big benefit of a job without a ton of upside. This was presented to me by hospital administration as being a far bigger benefit than it actually is. <Sigh>
 
It’s very simple guys.

Official State/local 457b plan. Yes do it (can rollover easy and backed by state

Non official state/local 457b No (cannot roll over and not protected from creditors)
 
Almost. For 457b nongovernmental You MIGHT be able to roll to another 457b when you leave. Depends on the plan document.
 
My understanding is that a 457b nongovernmental plan can only be rolled over into another 457b nongovernmental plan that accepts rollover. Finding such a plan seems unlikely.
 
eikenhein said:
I have about $25,000 in 457b at my non-profit hospital.
If I want to stop contributing into 457b, can i take out the funds that i've already put in?
would it just go into my payroll and get taxed?
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You can take the money out and pay taxes if you leave that employer or have an qualifying unforseeable hardship.
 
eikenhein said:
I have about $25,000 in 457b at my non-profit hospital.
If I want to stop contributing into 457b, can i take out the funds that i've already put in?
would it just go into my payroll and get taxed?
Click to expand...


You can usually on get the funds you have contributed if you separate from your employer.
 
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