403(b) Calculator

A 403(b) is a retirement plan for employees of public schools, 501(c)(3) nonprofits, hospitals, and certain churches. It works like a 401(k): you contribute pre-tax dollars (or Roth, if your plan offers it), the money grows tax-deferred, and withdrawals in retirement are taxed as ordinary income. The IRS rules around contribution limits are nearly identical between 403(b) and 401(k) plans, but 403(b) plans add a 15-year service catch-up that does not exist in 401(k) plans (IRS).

The employee deferral limit for 2026 is $24,500 for workers under 50, $32,500 for ages 50-59 and 64+ (with an $8,000 catch-up), and $35,750 for ages 60-63 under the SECURE 2.0 super catch-up. Eligible long-tenured employees can add another $3,000/year via the 15-year service catch-up, capped at $15,000 lifetime (IRS).

If you have 15 or more years of service with the same qualifying employer (typically a 501(c)(3), school, hospital, or church), you may be able to contribute up to $3,000 extra per year, capped at $15,000 over your lifetime. The 15-year catch-up applies before the age 50 catch-up. So at 50+, both can stack if you qualify. This provision is unique to 403(b) plans. 401(k) participants do not get it. Confirm eligibility with your plan administrator before relying on it.

Mechanically they're nearly identical: same contribution limits, same age 50 catch-up, same SECURE 2.0 super catch-up at 60-63. The differences are who offers them (403(b)s are for nonprofits, schools, and hospitals) and the rules around investment options and fees. 403(b) plans, especially in K-12 districts, historically offer expensive annuity products with limited mutual fund choices. Plan fees can be meaningfully higher than a typical 401(k). The 15-year service catch-up exists only in 403(b)s.

Many 403(b) plans, especially in K-12 school districts, are dominated by insurance-company annuity products with layered fees: mortality and expense charges, surrender charges, and high-cost subaccounts. Total fees of 2% or more are not uncommon. Some employers offer mutual-fund-only 403(b) options with much lower fees, but they are often less heavily marketed inside schools. If you have a choice between providers within your plan, check the expense ratios and any surrender schedules carefully. Over 30 years, the difference between 0.5% and 2% in fees can cut your final balance roughly in half.

Yes, if you have access to both (for example, working a primary job at a nonprofit with a 403(b) and a side job at a for-profit with a 401(k)). However, the IRS deferral limit is per person, not per plan. Your combined elective deferrals across 403(b) and 401(k) plans cannot exceed $24,500 (under 50) or the applicable catch-up amounts. Employer matches and 457(b) contributions have separate caps. Coordination gets complex. Confirm with your HR or a tax advisor.

You have several options: leave the money in the plan (if the balance allows), roll it into your new employer's 401(k) or 403(b), or roll it into an IRA. Rolling into an IRA usually gives you the broadest investment menu and lowest fees, especially compared to staying in a K-12 annuity-based 403(b). The rollover is non-taxable if done correctly as a direct trustee-to-trustee transfer. Cashing out triggers ordinary income tax plus a 10% early withdrawal penalty if you're under 59½ (with limited exceptions).

Traditional 403(b) contributions are pre-tax (lower tax bill now, taxable withdrawals later). Roth 403(b) contributions are after-tax (no tax break now, tax-free withdrawals later). If your plan offers a Roth option and you expect to be in a similar or higher tax bracket in retirement, Roth is often the stronger choice. Teachers and public-sector workers with pensions sometimes find their retirement tax bracket isn't as low as they expected. Modeling both in our Roth 401(k) calculator is a reasonable proxy for the Roth/Traditional decision.