"As I recall, the 457 has a larger amount for the
catch-up provision allowed for those over 50. "

Actually, they're the same.

"HW "Skip" Weldon" <skip5700removethis[at]hotmail.com> wrote in message
- quote -

This was changed several years ago and 457s now belong to the employee. I
thought of another difference with 457s and that is that you can have both a
457 and a 401k. This means that, if you can afford to do so, you can defer
the maximum for both plans. As I recall, the 457 has a larger amount for the
catch-up provision allowed for those over 50.

Elizabeth Richardson

On Mon, 13 Feb 2006 18:18:07 -0600, Nosmo_King58_[at]_yahoo.com (Nosmo
King) wrote:

- quote -

As Elizabeth mentioned, a governmental 457 plan avoids the federal
premature distribution penalty (10%) upon separation of service. The
only other technical difference I can think of is that 457s are not
trusteed plans - they are an asset of the employer. I've never seen
this as an issue because most municipalities can tax me to pay you.
<grin> Nevertheless, it bears mentioning.

Beyond that, the real difference between any savings plans is the
investment selection (fund choices and how you allocate among them).
If they are from different custodians and/or offer different choices,
I would pay particular attention to diversification and costs. Note
also that some 457s have custodian-imposed surrender charges which may
apply.

Bottom line: I consider this an investment matter and suspect that
ultimately your satisfaction with how you handle this issue will swing
on your investment decisions, not the vehicle used.

-HW "Skip" Weldon
Columbia, SC

457 is better then 401K

- quote -

The main difference between the two is that with the 457 you are allowed to
take withdrawals WITHOUT PENALTY when you end your service with the 457
employer. To me, this is the overriding factor, since you may decide on an
early retirement. The 457 buys freedom, if I can put it that way.

Elizabeth Richardson

I took a position with the local state government, and have been offered a
choice of a 401k and/or a 457 plan. Is there any advantage of one versus the
other ? Neither plan has matching contributions, and I can choose to
contribute to one or both options. The HR person mentioned that 457 plans
allow for withdrawals at any time, regardless of age, without penalty. I'm
familiar with 401k and 403b plans, but the 457 is new to me.

Thanx.