What are the disadvantages of a 457(b) plan?

The disadvantages of 457 (b) plans are: These plans are primarily offered to employees of state and local governments, as well as certain tax-exempt organizations. This means that individuals working in the private sector may not have access to a 457 (b) plan as part of their employer-sponsored retirement options.

What are the benefits of a 457(b) plan?

The biggest advantage of a 457 (b) plan is that you can save for retirement while getting a tax break. But there are also limitations to 457 (b) plans that you should be aware of. If you are within three years of the plan’s retirement age, you can double your “catch-up” contributions (for total contributions of $45,000 per year in 2023).

Is a 457 a 401(k)?

While any employer may offer a 401 (k), 457 plans are designed specifically for state and local government employees, as well as employees of certain tax-exempt organizations. That said, a 457 has fewer limitations on withdrawals. This guide will help you decide whether a 457 plan is right for you. What Is a 457 Retirement Plan?