457b Nationwide Retirement Options and Benefits

The 457b nationwide retirement plan is an excellent option for government employees and tax-exempt organizations. It's a deferred compensation plan that allows you to save for retirement on a tax-deferred basis.

One of the key benefits of a 457b plan is that it allows you to contribute a significant amount of money each year, up to $19,500 in 2022. This can add up quickly, making it a great way to build a nest egg for retirement.

You can also make catch-up contributions to a 457b plan, which can be especially helpful if you're behind on your retirement savings. In 2022, you can contribute an additional $6,500 if you're 50 or older.

Expand your knowledge: Employer Can Offer 457b Plan Means

A 457b plan is a type of retirement savings plan designed for public sector employees. It's a great way for government workers to save for their future, and it has some unique features that set it apart from other plans.

Take a look at this: 457b Plan Explained

One key difference is that 457 plans don't have an additional 10% early withdrawal tax, although withdrawals are still subject to ordinary income taxes. This can be a big relief for those who need to access their savings in an emergency.

There are some specific rules around withdrawals from a 457b plan. For example, if you need to withdraw money due to an unforeseen emergency, you may be able to do so without penalty, as long as you've exhausted all other financial resources.

Distributions from a 457b plan can be taken in a lump sum, annual installments, or as an annuity. This gives you flexibility and options for how you want to receive your retirement savings.

Here are some key distribution options for a 457b plan:

It's also worth noting that if you leave your job and roll over your 457b plan money into an IRA or your new employer's eligible retirement plan, you won't have to worry about tax withholding. However, if you don't roll over the distribution and don't take it in annual installments of more than 10 years, it will be subject to 20% mandatory federal tax withholding.

One major difference between 457b and 401(k) plans is their eligibility, with 457b plans designed for public sector employees and 401(k) plans for private sector employees.

The 457b plan has a more flexible withdrawal option, allowing for lump sums, annual installments, or an annuity.

There isn't an additional 10% early withdrawal tax for 457b plans, although withdrawals are subject to ordinary income taxes.

To avoid a 20% mandatory federal tax withholding, you can roll over your 457b distribution into an IRA or your new employer's eligible retirement plan if you leave for a new job.

Here's a summary of the key differences:

For unforeseen emergencies, 457b plans offer a withdrawal option if all other financial resources are exhausted, but this requires meeting certain legal criteria.

As a public employee, you're fortunate to have access to a 457(b) Deferred Compensation plan, which offers benefits other retirement plans can't, like penalty-free withdrawals once you stop working for your public sector employer.

Nationwide has worked with public sector employees for over 30 years, providing the tools and information you need to feel confident about investing for retirement.

The 457(b) plan allows you to contribute up to the current limits, which you can check out for the most up-to-date information.

You may be eligible for the Retirement Saver's Tax Credit, depending on your income level.

You can choose to make traditional or Roth contributions to your 457 plan, with Roth contributions allowing for tax-free withdrawals in retirement.

Roth 457 contributions are subject to taxes upfront, but you'll enjoy tax-free withdrawals if you're at least 59½ and have had the account for at least five years.

You can allocate part or all of your salary deferral to the Roth or traditional 457 pre-tax account, depending on your individual circumstances.

Consider making Roth 457 contributions if you think taxes will be raised before you retire, expect to be in a higher tax bracket when you retire, or are younger with many years until retirement.

Nationwide has been in the retirement plans business for nearly half a century and provides more 457 plans than anyone else in the market.

Additional reading: 457 Plan Catch up Contributions

They serve several of the largest state, county, and municipal 457(b) and related retirement plans, including police departments, fire departments, and utilities.

Their award-winning, full-service experience eases administrative work and helps keep clients happy.

They offer solution flexibility, including the ability to integrate with any payroll provider your client chooses.

Here are some key benefits of Nationwide's 457 plans: