Getting Started

A 403(b) is a retirement savings plan for employees of nonprofits, like universities. With a 403(b) retirement plan, you can save money before you pay taxes on it. The earlier you start contributing, the more time your money has to grow. That's called compounding, and it can really help you reach your retirement savings goals. Enroll now.

403(b) vs. 401(k): What is the difference? 

403(b) plans are offered by non-profit employers, like universities while 401(k) plans are typically offered by for-profit employers. Both types of plans can be rolled over into other retirement accounts and both have the same contribution rates. If you're interested in learning more before you get started, review the documents provided by your employer. They'll include additional details about your specific retirement plan.

As part of your benefits program, your employer offers a workplace savings plan to help you save for retirement. It makes a lot of sense to participate in it as soon as possible. Here's why.

1. Beyond providing a way to invest for retirement, workplace savings plans may offer huge tax advantages. For example, in some plans your contribution comes out of your paycheck before income taxes are deducted, which means your tax bill will be lower. You could also save on taxes when you withdraw the money if your salary is lower than during your working years.
2. Another huge advantage: the chance to get "free" money from your employer in the form of matching contributions.
3. Your retirement plan isn't just a generic or glorified savings plan for your day-­to-­day expenses. It's a long-­term personal plan for growing your savings by investing in a mix of mutual funds, stocks, and bonds.

There's a bit more to it, but that may be all you need to know to get going. If you're interested in learning more, review the documents provided by your employer. They'll include more details about your specific plan.

Of all the factors that influence the size of your nest egg, you control the one that matters most: How much you contribute to it. You can save whatever you like each year, up to the pre-­tax contribution limit set by the IRS. 

Your current income and monthly budget will have a lot to do with how much you can save. But if you're trying to find ways to save more, here are a few things to consider:

• Take advantage of your employer contribution, if your plan offers it. Your employer may match some, or all, of what you contribute, making this one of the fastest ways to boost your balance.
• Automate your savings. Setting up automatic contributions each month and automatically increasing your contributions by 1% or more each year (if your plan allows) are great ways to save, since the money goes directly to your retirement account.
• If you're 50 or older, catch up on your contributions. Saving later in life can still pay off. You may be able to contribute an additional amount each year, depending on the plan you're in.