A:

Yes. You may participate in both a 403(b) and a 401(k) plan. However, certain restrictions may apply to the amount you can contribute. For instance, you are allowed to make a salary deferral contribution of up to $18,000 in 2017, plus an additional $6,000 if the employee is 50 or older. The combined total salary deferral contribution that you make to both the 401(k) and the 403(b) plans should not exceed $18,000 or $24,000 if you're 50 or over.

Note: 403(b) plans include a special provision that allows you to make salary deferral contributions of additional amounts up to $3,000 if you have at least 15 years of service with certain employers. If you meet the 15-year requirement and would like to contribute the additional amount, you should check with your employer regarding the eligibility requirements and applicable rules.

To learn more, read Increased Savings Opportunities.

This question was answered by Denise Appleby
(
Contact Denise)

RELATED FAQS
  1. What is the difference between a 401(k) plan and a 403(b) plan?

    Administered by for-profit, private companies, 401(k) plans are more common than the nonprofit or government-sponsored 4 ... Read Answer >>
Related Articles
  1. Retirement

    Top 9 Benefits of a 403(b) Plan

    Find out how the 403(b) plan helps employees of nonprofit entities meet their retirement goals.
  2. Financial Advisor

    403(b) Plan Tutorial

    Learn about the set-up, the contributions and the distributions for this retirement plan for certain employees of public schools and tax-exempt organizations.
  3. Retirement

    Got a 403(b) Plan? Here's What You Need to Know

    Many folks do not understand the ins and outs of their 403(b) plan. Let's change that.
  4. Retirement

    Top 9 Benefits Of A 403(b) Plan

    A 403(b) plan is a tax-sheltered retirement plan for employees of many non-profit entities, including public safety and educational organizations.
  5. Retirement

    401(k) Contribution Limits in 2016

    Find out what the contribution limits are for 401(k) retirement savings plans in 2016, including individual, employer and aggregate limits.
  6. Retirement

    Why are 401(k) contributions limited?

    Find out why contributions to 401(k) retirement plans are limited, including what the current contribution limits are and how limits encourage participation.
  7. Retirement

    How to Save More for Your Retirement

    Be sure you know all the tax-advantaged ways in which you can save more for retirement.
  8. Financial Advisor

    The 4-1-1 on 403(b) Plans

    These plans resemble 401(k) plans in many respects, but are specially designed for nonprofit entities.
  9. Retirement

    New Retirement Plan Limits for 2016

    Here's what the limits look like for 2016, compared to 2015 (the taxes you'll file in April).
RELATED TERMS
  1. Designated Roth Account

    An individual retirement plan in which employees can have all ...
  2. IRS Publication 571: Tax-Sheltered Annuity Plans (403(b) Plans) For Employees of ...

    A document published by the Internal Revenue Service (IRS) that ...
  3. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt ...
  4. Matching Contribution

    A type of contribution an employer chooses to make to his or ...
  5. 401(k) Plan

    A qualified plan established by employers to which eligible employees ...
  6. Nonelective Contribution

    A type of contribution an employer chooses to make to each of ...
Hot Definitions
  1. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  2. Absolute Advantage

    The ability of a country, individual, company or region to produce a good or service at a lower cost per unit than the cost ...
  3. Nonce

    Nonce is a number added to a hashed block, that, when rehashed, meets the difficulty level restrictions.
  4. Coupon

    The annual interest rate paid on a bond, expressed as a percentage of the face value. It is also referred to as the "coupon ...
  5. Socially Responsible Investment - SRI

    Socially responsible investing looks for investments that are considered socially conscious because of the nature of the ...
  6. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
Trading Center