I am reaching the point where I have to make a decision about my benefits at the university. I have the option of 3 retirement accounts-I can choose all 3 or none or a combination.
The first is the standard university one. The university will contribute 4% of my pay and will match up to another 4% of my own contributions. Downside is I am not vested until I've been here 3 years and I am almost positive I don't want to be here that long.
Second one is Tax Deferred Account (TDA) in a 403(b) with a recommended 5% contribution. I am 100% vested immediately. I chose to up it to 10% which will be approximately $56 a paycheck. It's not going to make me rich but it will help come tax time.
The last one is a 457(b) plan. Again, I am immediately 100% vested. I can't decide if I should save here as well. I am not planning on staying here forever and I do want to use this paycheck to pay down debt.
Advice? I think I am going to forgo contributing to the 457(b) but my mind can be changed...
Pre tax my paychecks will be 564. I'll have $56 taken out for the 403b, $65 in extra fed and state withholding and approximately $84 out in regular taxes. That leaves $358, which will go a long way towards the renovation costs.
Deciding on benefits and advice needed.
October 7th, 2015 at 02:26 pm
October 7th, 2015 at 02:38 pm 1444228721
However, money in a 457 plan is accessible before age 59.5 without paying the 10 percent penalty you would pay for taking early distributions from a 401k, 403b, or an IRA. That makes these plans useful for early retirees.
Often, it boils down to the investment options offered. If high fee annuities are the only options. you may want to skip investing. If you have reasonable mutual fund choices, you can reduce your current taxes and save more for retirement with these plans.
October 7th, 2015 at 02:41 pm 1444228876
October 9th, 2015 at 10:03 pm 1444428234
Even if you left before you were vested, you would still get all your own contributions. So you have nothing to lose and a chance you'll wind up there after 3 years anyway and then you'll get the bonus money.
I would never pass on a free 8% on my money.
October 9th, 2015 at 10:07 pm 1444428424