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Tom F

457 and 403B combined limits

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I teach in Indiana and had a question about contribution limits.  

I understand that both plan types have limits.  What I am not sure about is if those limits are considered separate or if they are combined.

In other words is my total contribution limit $19,000, or could I contribute  $19,000 + $19,000 = $38,000?

 

Also a related question.  If I am putting $6,000 in ROTH IRA with Vanguard do I need to subtract that from my 403B/457 limits?

$19,000 - $6,000 = $13,000?

 

 

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You can contribute 19k to both your 403b and 457 plans in 2019. In addition you can contribute 6k to your Roth IRA. The IRA limit is separate from the employer plan limits. If you are over 50, there's a 6k catchup allowed on both the 403b and the 457 plans, and a 1k catchup on the Roth IRA.

Hopefully you have low-cost vendors for your 3 accounts. 

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Dont forget out doubling your 457 contribution in the three years leading up to retirement.  

If you're over 50 and within 3 years of retirement, 

403 $19,000 + $6,000

457 $19,000 + $19,000  (little known catchup)

IRA $6,000 + $1,000

Total:  $70,000

 

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And don't forget you can do the catch-up for the 403b too. You can do the $19,000 + $19,000 but not the $19,000 + $19,00 + $6,000.

It looks like this, potentially. All I did was tell the 457 people and the 403b people that I was within three years of being able to retire (that is a very vague rule, btw, so don't let it bog you down) and put it in writing. 

403b - $19,000 + $19,000, for three years.

457 - $19,000 + $6000 for those three years.

Then, the next three years I reversed it. You can do a mix of Roth and traditional if your plan allows. Add the Roth IRA to the mix, and you are....broke!

 

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