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TOPIC: What is a Tax Deferred Annuity Plan?

What is a Tax Deferred Annuity Plan? 3 days 7 hours ago #1

  • Wanderer
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GOLDBUG you make a good point. See companies offering their benefits and they have the option of retirement plans. Have to sigh as the workers are making enough to exist and extras for retirement are few and far between. Truth I never could afford it until I was working in a higher income where I actually had extra discretionary money to set aside.
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What is a Tax Deferred Annuity Plan? 3 days 22 hours ago #2

  • Goldbug
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Lexie wrote:
So True FrankN. These days a lot of companies are trying to reduce costs by only hiring part time workers. This means they don't have to supply benefits or investment plans. Many folks are on their own when it comes to insurance and retirement.
Too true, and it is normally the lower paid workers who see their benefits and their hours slashed, which means that they are the people in the worst positions to pay for insurance or invest for retirement.
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What is a Tax Deferred Annuity Plan? 2 weeks 1 day ago #3

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So True FrankN. These days a lot of companies are trying to reduce costs by only hiring part time workers. This means they don't have to supply benefits or investment plans. Many folks are on their own when it comes to insurance and retirement.
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What is a Tax Deferred Annuity Plan? 2 months 2 days ago #4

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This used to be fairly common, but most companies do not offer this anymore.
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What is a Tax Deferred Annuity Plan? 2 months 4 days ago #5

  • Moneyes
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Goldbug wrote:
A Tax Deferred Annuity Plan, called a 403b, is one where you pay the money in, and do not pay the tax on it until you withdraw it, usually after you retire.

Hence the term, tax deferred. My job has something like that as well and, you're right, it is a complex thing to be a part of, but it pays well in the end

It lets the funds grow with the benefit of extra seed capital from the money you'd otherwise have paid in tax. It's a really complex topic, and I am not an accountant, so you might find this useful on the differences: http://www.403bwise.com/

Thank you for the link. Going in my bookmarks right next to the Turbo Tax bookmark.
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What is a Tax Deferred Annuity Plan? 2 months 4 days ago #6

This sounds like a really great opportunity for you. If their contribution is based on the money you earn, does that mean that at the end of four years they put 100% of what you earned that year into the plan? I've never heard of anything like this, but I have a feeling you're going to be racking up a good retirement egg.
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What is a Tax Deferred Annuity Plan? 2 months 4 days ago #7

FrugalFran, how I understand it is that these are the amounts that they will put in your plan at the end of the year based on how much money you've made throughout the year. I'm hoping that I get a chance to sit in on the retirement meeting that's coming up in a few weeks. I'm not eligible to sign up yet, but it would be nice to know how it all works.
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What is a Tax Deferred Annuity Plan? 2 months 2 weeks ago #8

What's the difference between this and a regular IRA?

Breakinger, how does the company contribution work? Are those percentages indicating how they will match your contribution?
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What is a Tax Deferred Annuity Plan? 2 months 2 weeks ago #9

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A Tax Deferred Annuity Plan, called a 403b, is one where you pay the money in, and do not pay the tax on it until you withdraw it, usually after you retire. It lets the funds grow with the benefit of extra seed capital from the money you'd otherwise have paid in tax. It's a really complex topic, and I am not an accountant, so you might find this useful on the differences: http://www.403bwise.com/
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What is a Tax Deferred Annuity Plan? 2 months 2 weeks ago #10

I am starting a new job in a week and while I was looking through their personnel policy I found that they offer a retirement program through a Tax Deferred Annuity Plan. Has anyone ever heard of this and can explain it to me? Every other job I've ever worked at has always been a 401k. It also states that each year the agency will make contributions to the plan like this:
1 year 25%
2 years 50%
3 years 75%
4 years 100%
It says that I can make contributions too, which I want to do, but how much should I invest myself?
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