Understanding Your Voya 457b Retirement Plan

The Voya 457b retirement plan is designed to provide tax-deferred savings for employees of participating employers.

This plan allows you to contribute a portion of your salary to your retirement account on a pre-tax basis, reducing your taxable income and lowering your tax liability.

You can contribute to your 457b plan through payroll deductions, making it easy to save for retirement over time.

The plan offers a range of investment options, including stocks, bonds, and mutual funds, allowing you to diversify your portfolio and potentially grow your retirement savings.

On a similar theme: 403 B Dc Plan

A 457(b) plan is a great way to save for retirement, and here's why. You can reduce your taxable income by contributing to your 457(b) plan, and you get to determine how much you contribute each year.

Your contributions are made on a pre-tax basis, which means they lower your current taxable compensation. If your employer is a governmental entity, you may also be able to contribute on a Roth after-tax basis, which can be a good option for some people.

On a similar theme: Deferred 457 Plan

The investment earnings in your 457(b) account grow tax-deferred, meaning you won't have to pay taxes on them until you withdraw the money. This can be a big advantage, especially if you're not ready to retire yet.

You can choose from a variety of investment funds offered under your 457(b) plan, which allows you to diversify your investments and create a mix of growth and safety that feels right for you.

Here are some key features of a 457(b) plan to consider:

If you're a longer service employee, you may be able to contribute more to your 457(b) plan than the general IRS limits allow. This is called a catch-up contribution, and it can be a big help if you're trying to save for retirement.

The annual contribution limit for a Voya 457(b) plan is a crucial aspect to understand. The total of all employee contributions made in a taxable year and employer contributions that are 100% vested in that taxable year cannot exceed $23,000 for 2024, as indexed annually by the Internal Revenue Service for cost-of-living adjustments in $500 increments.

For more insights, see: 457b Catch up

Employee contributions, including both pre-tax and after-tax designated Roth contributions, are subject to this annual limit. The limit applies to all 457(b) plans an individual has participated in during the taxable year.

A participant is always vested in employee contributions made to the 457(b) plan. Employer contributions that are not vested when contributed do not count toward the 457 annual contribution limit in effect in the taxable year of contribution.

There are two key factors to consider: the contribution limit and vesting. Employee contributions and vested employer contributions, along with applicable earnings on those vested employer contributions, count toward the General 457 Annual Contribution Limit in effect in the taxable year that contributions are vested.

Here are the key points to remember:

A 457b plan is a type of deferred compensation plan offered by certain employers, including government entities and tax-exempt organizations.

These plans allow employees to set aside a portion of their salary on a pre-tax basis, reducing their taxable income for the year.

Contributions are made on a before-tax basis, which can lower your tax liability and increase your take-home pay.

You can contribute up to the annual limit, which is $19,500 in 2022, and an additional $6,500 if you are 50 or older.

The funds in your 457b plan can be invested in a variety of options, including mutual funds, stocks, and bonds.

Voya is a popular provider of 457b plans, offering a range of investment options and administrative services.

The money in your 457b plan grows tax-deferred, meaning you won't pay taxes on the investment earnings until you withdraw the funds.

Withdrawals are generally subject to income tax, but you may be able to avoid penalties if you meet certain conditions, such as separating from your employer or reaching age 59 1/2.