Finance Definition
457 Plan
📈 Investing
intermediate

Quick Definition

A 457 plan is a type of tax-advantaged retirement savings plan available to certain public sector and non-profit employees.

Examples

  • 1A public school teacher contributing a portion of their salary to a 457 plan to save for retirement.
  • 2A city employee using a 457 plan to defer taxes on their retirement savings until withdrawal.
  • 3An employee of a non-profit organization choosing between a 457 plan and a 401(k) for their retirement savings.

Tags

retirementtax-advantagednon-profitpublic-sectordeferred-compensation
Related Terms
Other terms you might find helpful
401(k) Plan
A 401(k) plan is a tax-advantaged retirement savings account offered by many employers in the United States, allowing employees to save and invest a portion of their paycheck before taxes are taken out.
Roth IRA
A Roth IRA is a type of individual retirement account that allows for tax-free growth and tax-free withdrawals in retirement, provided certain conditions are met.
Quick Info
Category:Investing
Difficulty:intermediate
Last Updated:6/16/2025