Teacher Retirement Plans 403(b) Plan The 403b plan is a retirement plan offered to non-profit organizations. Very often it is offered as a retirement plan for public school teachers. The plan is a 401k equivalent for teachers, school employees, and other non-profits. The rules and contribution limits for the two plans are similar. Withdrawals cannot be made before the age of fifty-nine and a half. If an early withdrawal is made then there may be a 10% tax penalty. 457 Plan The 457 plan is a retirement plan offered to government employees. It is often offered to teachers, firefighters, police officers, and other government employees. A 457 plan allows for withdrawals before the age of fifty-nine and a half from participants who have separated from service. These early withdrawals will be made without tax penalty. FAQs FAQs: 403(b) PlanWhat age can I make a withdrawal from my 403(b) plan without a penalty?You can start making withdrawals after you reach the age of 59 and a half. If a withdrawal is made before this then there may be a ten percent tax penalty.What is the smallest amount I can contribute to my 403(b) plan per month?You can start with as little as $25 per month as a contribution to the plan.When will I start paying taxes on my 403(b) plan?You will start paying taxes once you start taking distributions Who is offered a 403(b) plan?Non profit organizations offer 403(b) plans. Education falls under the non-profit category. Here at PFSNH we specialize in teachers 403(b) plans. The 403(b) plan is a common retirement plan offered by school districts to public school teachers. FAQs: 457 PlanWill I be charged an early withdrawal fee on my 457 plan?No you will not be charged an early withdrawal fee as long as you separate from service with the original provider. A 457 plan will allow participants that have separated from service access to their account without tax penalty.When do the contributions I have made to my 457 plan start to get taxed?Your contributions are not taxed until you withdraw money from the account. You pay taxes during retirement. However, you may have to pay income taxes. Informational Videos 403b vs. 457 Retirement Plans with Anne Murray Time to start contributing to your 403(b) & 457 Plans! Are You Making the Most of Your 403(b) and 457 Plans? What is a 403(b)?