Public School Employees Are Eligible for Two Tax-Favorable Retirement Plans

A 403b and 457 Plans

Both Have Catch-op Options

  • The 403(b) 15 year catch-up allows some public-school employees with 15 years of service with the same employer to contribute an extra $3,000 a year for five years.
  • One problem with this catch-up is any amounts contributed over $19,000 (basic limit) are credited first against the 15-year rule. So, a teacher who is age fifty or over could use up the fifteen-year catch-up without knowing it
  • The 457 plan has a larger catch-up. It allows eligible employees to contribute $37,000 a year for three years before they reach their “normal retirement date.
Catch-up Options
The 403(b) Options In Your School System

A

Abington Public Schools

Acton- Boxborough Regional School District

Arlington Public Schools

Ashland Public Schools

Attleboro Public Schools

Avon Public Schools

B

Bedford Public Schools

Bellingham Public Schools

Belmont Public Schools

Billerica Public Schools

Blue Hills Regional Technical School

Boston Public Schools

Brookline Public Schools

C

Canton Public Schools

Carlisle Public Schools

Carver Public Schools

Chelmsford Public Schools

Cohasset Public Schools

Concord Public Schools

Concord-Carlisle Regional School District

D

Danvers Public Schools

Dartmouth Public Schools

Dover Public Schools

Dover Sherborn Regional School District

F

Fall River Public Schools

Framingham Public Schools

Freetown Lakeville Regional Schools

G

Groton-Dunstable Regional School District

H

Hanover Public Schools

Harvard Public Schools

Holliston Public Schools

Hudson Public Schools

L

Lawrence Public Schools

Lexington Public Schools

Lincoln-Sudbury Regional High School

Lowell Public Schools

Lynnfield Public Schools

M

Malden Public Schools

Manchester Essex Regional School District

Mansfield Public Schools

Martha’s Vineyard Regional High School

Marshfield Public Schools

Maynard Public Schools

Melrose Public Schools

Middleborough Public Schools

Milton Public Schools

Minutemen Regional

N

Nahant Public Schools

Natick Public Schools

Needham Public Schools

Newton Public Schools

North Andover Public Schools

North Attleborough Public Schools

Northborough Southborough Regional School District

Norton Public Schools

Norwood Public Schools

P

Pentucket Regional School District

Plymouth Public Schools

R

Randolph Public Schools

Rockland Public Schools

S

Sandwich Public Schools

Saugus Public Schools

Scituate Public Schools

Sherborn Public Schools

Somerville Public Schools

South Shore Education Collaborative

Stoneham Public Schools

Stoughton Public Schools

Sudbury Public Schools

T

Tewksbury Public Schools

Tyngsboro Public Schools

W

Wakefield Public Schools

Waltham Public Schools

Watertown Public Schools

Wellesley Public Schools

Westford Public Schools

Weston Public Schools

Westport Public Schools

Westwood Public Schools

Weymouth Public Schools

Wilmington Public Schools

Winchester Public Schools

Woburn Public Schools

  • Your school system provides you with a list of 403(b) companies. ↑
  • The 457 is different. The city/town usually provides one company.
  • Both give you a broad range of investment options.
  • You decide what plan to use and the amount that you want to save before taxes from your paycheck
  • In 2018, the basic limit is $18,500 and an educator age fifty or over can save an extra $6,000.
  • The IRS, however, allows educators to contribute $18,500 to a 403(b) and a 457.*
  • The ability to put in the most pre-tax into two retirement plans is unique to the 403(b) and 457.

Public Employee Pensions, Maybe Rhode Island Figured it Out?

Notes:

  • School systems should think about eliminating the 15-year catch-up from their 403(b) plan. Especially if there is no system in place to track if the catch-up contribution is from it or the age fifty.
  • Any employee who is saving the greatest in a 403(b) and wants to save more money can usually open up a 457 plan.
  • Remember, if eligible, you can use the 457 catch-ups with the 403(b) plus the age fifty catch-up making it an excellent option for any educator who wants to defer sick buybacks.

403b Plan Advisor for Teachers and Administrators In Massachusetts

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