401(k) & 403(b)
These retirement savings plans are funded by employee contributions, and in many cases, matching contributions from the employer. If your employer offers a 401(k) or 403(b) plan, you should take full advantage of it.
Features & Benefits
- Contributions are made before taxes
- Many employers will match a portion of the employee contributions
- Funds can be invested in a variety of mutual funds
- Earnings grow tax-free until withdrawn
- Plans and guidelines around eligibility and matching funds are established by the employer. Check with your employer to see if you're eligible.
What's The Difference Between a 401(k) and a 403(b)?
They're basically the same; however nonprofit companies, religious groups, school districts and governmental organizations use a 403(b). Laws allow these organizations to be exempt from certain administrative processes that apply to 401(k) plans.
403(b) accounts allow for an additional contribution of $3,000 for employees who have 15 or more years of service.
This material is meant to educate and not to provide legal, tax, accounting or investment advice. PNC and its vendors do not provide legal, tax or accounting advice. You should seek the advice of an investment professional to tailor a plan to your particular needs.
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