Take Advantage of the 403b Retirement Plan

March 25, 2007 by sachinskg

Planning for retirement is something most of us have to face sometime in our lives to ensure we are financially secure during our twilight years. The 403b retirement plan is among the programs we can take advantage of.

To be eligible for the 403b plan, you must belong to a certain category of professionals who have worked for tax-exempt institutions.

The 403b is a tax-deferred retirement plan that allows you, upon joining, to take advantage of a savings program. This affords you a number of benefits, which you can find more information on from your investment dealer or accountant. However, because the 403b is a government-sanctioned plan, even eligible candidates must fulfill certain requirements.

§ Contribution – you must be able to contribute at least $200 a year in order to qualify for this plan.
§ Profession – you must belong to one of these tax-exempt professions: doctor, teacher researcher, librarian, school administrators and personnel, nurses, professors and ministers. In short, you have to have worked for tax-exempt organizations.

In addition, you are not qualified to apply for 403b status if you belong to the following category of people – students, non-resident aliens and employees working less than 20 hours a week.

It is important to note that employers who have signed up for 403b status must apply these rules rigidly. Failure to so could result in the whole company and all its employers being stripped for their 403b benefits.

It is recommended that you study closely the advantages and disadvantages of the 403b retirement plan to decide whether or not your company is interested, or indeed eligible, to qualify for its benefits.

You are encouraged to shop around and look at the various 403b retirement plans on offer in order to find the benefits that are best suited to you or your employers. If you can find an ideal plan, the benefits are worthwhile. You and your employees can enjoy a financially secure retirement.

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