If you work for a tax-exempt organization, a 403(b) plan is a tool that may help you reach your retirement goals. 403(b) retirement plans are also known as tax-sheltered (or tax-deferred) annuities. Tax-deferred 403(b) plans are designed for employees of:
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Answer Wiki. Both 401(k) and 403(b) are just sections of the internal revenue code. They both allow employees to set aside a portion of their compensation, before income taxes are applied, to grow tax-free until taken out and taxed at retirement or termination of employment. The primary differences are.
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A 403(b) plan is very similar to a 401(k) plan. Generally, 403(b) Tax-Sheltered Annuity (TSA) plans are available to employees of some nonprofits, hospital organizations, and public education institutions. Just as with a 401(k) plan, you will have the option to choose to invest in conservative, middle or high-risk investments.
403b plans are also known as tax-sheltered annuities (tsa). Despite its other name, 403b plans allow employees to not only invest in annuities but also invest in mutual funds, depending on the employer. An annuity is a financial product that is offered to someone who is concerned that he/she will outlive his/her savings.
Answers. Best Answer: You mean the difference between a 401(k) and 403(b). They are essentially the same, except the 401(k) is used by profit oriented companies as a vehicle for its employee’s retirement funds. The 403(b) serves the same function for employees of not-for-profit organizations such as colleges, hospitals, and charitable foundations.
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