403(b) Plan

Definition of '403(b) Plan'

A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers.

Generally, retirement income accounts can invest in either annuities or mutual funds.

Also known as a "tax-sheltered annuity (TSA) plan".

Investopedia explains '403(b) Plan'

The features of a 403(b) plan are very similar to those of a 401(k) plan. Employees may make salary deferral contributions that are usually limited by regulatory caps. Individual accounts in a 403(b) plan can be any of the following types:

- An annuity contract, which is provided through an insurance company
- A custodial account, which is invested in mutual funds
- A retirement income account set up for church employees

Related Definitions

401(k) Plan

A qualified plan established by employers to which eligible employees may make salary deferral (salary reduction) contributions on a post-tax and/or pretax basis. Employers offering a ...
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457 Plan

A non-qualified, deferred compensation plan established by state and local governments and tax-exempt governments and tax-exempt employers. Eligible employees are allowed to make salary ...
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Custodial Account

1. An account created at a bank, brokerage firm or mutual fund company that is managed by an adult for a minor that is under the age of 18 to 21 (depending on state legislation). 2. A ...
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- Pension Plan
  
  A type of retirement plan, usually tax exempt, wherein an employer makes contributions toward a pool of funds set aside for an employee's future benefit. The pool of funds is then ...
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- Qualified Joint And Survivor Annuity - QJSA
  
  An annuity payment from a qualified plan or 403(b) account that provides a life annuity to the participant and a survivor annuity for the spouse after the participant’s death. QJSA rules ...
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- Tax-Sheltered Annuity
  
  A type of annuity that allows an employee to make contributions from his or her income into a retirement plan. The contributions are deducted from the employee's income and, as a result, ...
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- TIAA-CREF
  
  A nonprofit organization that provides investment and insurance services for those working in education, medicine, culture and research. TIAA-CREF, short for Teachers Insurance and ...
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- Voluntary Employees Beneficiary Association Plan - VEBA
  
  A tax-free post-retirement medical expense account used by retirees and their eligible dependents to pay for any eligible medical expenses. The plan is funded by the amount of unused ...
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- Qualified Automatic Contribution Arrangements - QACAs
  
  Also known as QACAs, these were established under the Pension Protection Act of 2006 as a way to increase workers' participation in self-funded defined contribution retirement plans such ...
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- Eligible Automatic Contribution Arrangements - EACAs
  
  Also known as EACAs, these were created as part of the Pension Protection Act of 2006 to encourage more worker participation in self-funded defined contribution retirement plans. Like ...
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Nearby Definitions

403(b) Plan
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403(b) Plan Tutorial

Learn about the set-up, the contributions to and the distributions from this retirement plan for certain employees of public schools and tax-exempt organizations.
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Roth Feature Boosts Benefits For 401(k) And 403(b) Plans

Roth accounts tend to beat Traditional plans over the long term by providing tax savings.
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- Top 9 Benefits Of A 403(b) Plan
  
  Find out how the 403(b) plan helps employees of nonprofit entities meet their retirement goals.
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- Introductory Tour through Retirement Plans
  
  Here you will find tutorials that are each devoted to one the most common retirement plans, explaining how to establish, fund, and then take distributions from it.
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- I have a 403(b). Can I switch it to a different provider?
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- Is my 403(b) account owned by me or by the institution?
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403(b) Plan

Definition of '403(b) Plan'

Investopedia explains '403(b) Plan'

Related Definitions

Nearby Definitions

403(b) Plan

Articles Of Interest

Disbanding The Euro

Is Bank Of America In Danger?

The Greatest Currency Trades Ever Made

The Enron Collapse: A Look Back

Day Trading Strategies For Beginners

The Biggest IPO Flops

How HELOCs Can Hurt You