A 403(b) plan is a type of qualified retirement plan offered to employees of non-profit organizations, educational institutions, civil government and some self-employed ministers. The 403(b) plan is often compared to a 401(k) plan because it shares many of the same characteristics, withdrawals, contribution limits, tax rules and investment choices.
Individual 403(b) accounts are established and maintained by eligible employees. Accounts can be one of the three types: an annuity contract provided through an insurance company; a custodial account provided through a retirement account, investments are limited investment companies, such as mutual funds; a retirement income account, for which investment options are either annuities or mutual funds. The employer may determine the financial institution at which the employees may maintain accounts.
Employer sponsored plan under which employees can elect to contribute a portion of their wages to a retirement plan on a pretax and/or after tax basis up to a maximum allowed by law.
A Safe Harbor 401(k) plan is similar to a traditional 401(k) plan, but, among other things, it must provide for employer contributions that are fully vested when made.
A profit-sharing plan is a qualified employer sponsored plan in which an employer has the discretion to determine the date and amount of company contributions into the plan.