403b Calculator
Calculate your 403(b) plan growth over time. Project contributions, investment returns, and retirement savings for this tax-advantaged retirement account.
403(b) Results
Annual Summary
Tax Benefits
Understanding 403(b) Plans
A 403(b) plan is a retirement savings plan for employees of public schools, certain tax-exempt organizations, and ministers. Similar to 401(k) plans, 403(b)s offer tax advantages and are also known as Tax-Sheltered Annuity (TSA) plans.
403(b) vs Other Retirement Plans
| Feature | 403(b) | 401(k) | IRA |
|---|---|---|---|
| Eligibility | Public school employees, 501(c)(3) orgs | Private sector employees | Anyone with earned income |
| Contribution Limit 2024 | $23,000 | $23,000 | $7,000 |
| Catch-up (50+) | $7,500 | $7,500 | $1,000 |
| Employer Match | Sometimes available | Common | No |
| Investment Options | Mutual funds, annuities | Broad range | Broad range |
Contribution Limits
403(b) contribution limits are set by the IRS and match 401(k) limits for 2024.
- Employee Contribution Limit: $23,000 for 2024
- Catch-up Contribution (Age 50+): Additional $7,500
- 15+ Years of Service: Additional $3,000 catch-up
- Total Limit: $69,000 including employer contributions
Special 403(b) Features
- 15-Year Rule: Additional $3,000 catch-up for long-term employees
- Loan Provisions: Can borrow up to 50% of vested balance or $50,000
- Higher Contribution Limits: Some plans allow up to 100% of compensation
- Annuity Options: Many 403(b)s offer annuity payout options
- Hardship Withdrawals: Available for financial hardships
Investment Choices
403(b) plans typically offer mutual funds and annuities as investment options.
- Mutual Funds: Stock, bond, and balanced funds
- Target Date Funds: Automatically adjust asset allocation
- Index Funds: Low-cost, passive investment options
- Annuities: Fixed or variable annuity contracts
- Stable Value Funds: Low-risk, guaranteed return options
Tax Advantages
- Pre-tax Contributions: Reduce current taxable income
- Tax-Deferred Growth: Earnings grow tax-free until withdrawal
- Taxable Withdrawals: Withdrawals taxed as ordinary income
- Early Withdrawal Penalties: 10% penalty before age 59½
- Required Minimum Distributions: Must begin at age 73
Withdrawal Rules
- Age 59½: Penalty-free withdrawals available
- Separation from Service: Can withdraw after leaving employer
- Loans: Up to 50% of vested balance or $50,000
- Hardship Distributions: Available for immediate financial need
- Qualified Domestic Relations Order: Distributions for divorce settlements
Pro Tip: 403(b) plans are excellent retirement savings vehicles for educators, healthcare workers, and nonprofit employees. Take advantage of catch-up contributions if you're 50+, and consider the 15-year rule if you've been with your employer for an extended period. Always maximize employer matching contributions if available.