403(b) plan

A 403(b) plan is much like the more commonplace 401(k) retirement account, but for particular types of staff. This includes the employees of tax-exempt organizations and public schools. A 403(b) plan is a retirement plan which offers staff a way to save for retirement while paying less tax. However, the investment options are often more limited than the private-sector’s counterpart, 401(k)s.
Professions who may have a 403(b) plan available include doctors, nurses, librarians, teachers, government employees, and other public service workers. Many 403(b)s allow members to make additional catch-up contributions to save even more towards retirement. Funds may not be withdrawn from this account without a penalty until the employee is 59.5 years old, unless under specified particular circumstances.