2006-12-01 08:43:32 · 3 answers · asked by lacksalife 1 in Business & Finance ➔ Personal Finance
They are essentially the same thing. 401k is the coding for a private firm investment vehicle. 403b is the coding for public investment vehicles. If you work for the state or fed you would invest in a 403b instead of a 401k.
2006-12-01 08:46:50 · answer #1 · answered by holbrpa 2 · 0⤊ 0⤋
They are basically the same. They both allow the same contribution. They can be invested in the same manner. And the eventual withdrawal rules are the same.
The biggest difference is that 403B accounts are annuity contracts sold through insurance companies. There are restrictions on when you can get out. These restrictions are represented by reversion fees that are charged against your account if you try to get out before a certain amount of time has expired. In addition the fees that are charged against your account each year for management fees, investment expenses and sales charges are usually higher in an annuity product than in a 401K account.
2006-12-01 09:25:46 · answer #2 · answered by waggy_33 6 · 0⤊ 0⤋
401(k)s are private-sector, company retirement plans. They offer workers tax-deferred retirement investing.
A 403(b) plan is a retirement plan for University, civil government, and not-for-profit employees. It has similar characteristics and benefits of a 401k.
2006-12-01 08:51:42 · answer #3 · answered by j3nzsrfs 1 · 0⤊ 0⤋