Investments Retirement

Q&A: What is a 457?

A 457 is a type of retirement account usually offered by tax-exempt organizations (governments, schools, police/fire departments) that is very similar to a 403b, except 457’s allow for penalty-free withdrawals upon retirement instead of having to wait until age 59.5.

Pro Tip: For someone who is able to contribute to both a 403b and a 457, it would seem most efficient to max out the employer match on the 403b, while contributing anything more to the 457. This takes advantage of the employer match, while not tying more money up until 59.5 than necessary.

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