How to Make the Most of Your 403(b) & 457(b) Plan

Your employer may offer access to two powerful retirement savings tools: the 403(b) and 457(b) plans. These accounts provide valuable opportunities to grow your wealth while taking advantage of important tax benefits. To help you make the most of these options, here are a few key strategies to consider.

1. Maximize Your Contributions

For 2025, you can contribute up to $23,500 to both your 403(b) and 457(b) plans. If you're age 50 or older, that limit increases to $31,000 per plan. And if you're between ages 60 and 63, you may be eligible to contribute up to $34,750 to your plan under the special catch-up provision. These generous limits offer a powerful opportunity to accelerate your retirement savings.

2. Leverage Tax Advantages

Pre-tax vs. Roth Contributions: Pre-tax contributions reduce your taxable income now, while Roth contributions grow tax-free, allowing you to withdraw funds tax-free in retirement.
Understanding the 457(b): Unlike a 403(b), the 457(b) is a non-qualified deferred compensation plan, meaning it has different withdrawal rules and no early withdrawal penalty once you leave

3. Take Full Advantage of Employer Contributions

Make sure you're contributing enough to receive the full employer match or contribution available through your retirement plan. Some employers contribute to a Basic Retirement Plan (BRP) when you participate in a 403(b), even if they don’t match contributions in a 457(b). Maximizing these contributions is essential, it’s additional retirement savings at no extra cost to you

4. Work with a Financial Professional

Every individual’s situation is unique, and a well-structured plan can make a significant difference. Partnering with a fiduciary financial advisor can help you develop a personalized strategy that aligns with your goals and ensures you're making the most of all available retirement benefits and planning opportunities.

Take Control of Your Financial Future

Your role at your employer may come with incredible retirement benefits—now is the time to make sure you’re utilizing them to their full potential. If you want to explore a customized plan that fits your career and lifestyle, let’s connect and discuss your options.