What is a 403(b) Plan?

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Fundamentally, a 403(b) plan is very similar to a standard 401(k). It is available to organizations in the public education field, some non profit employers, and ministers who are self-employed. Money is placed in a similar way as 401(k), and is taxed in the same way.

So money placed into the account is deducted from income tax at the time when it is placed into the account, and only gets taxed after it is withdrawn from the account. Until 2005, these plans had a disadvantage in that those which didn't conform to all of the Employee Retirement Income Security Act guidelines weren't protected from creditors in case of bankruptcy. Today, a 403(b) plan is protected just like other retirement accounts. It can hold a very limited selection of assets, mainly annuity contracts and mutual funds.

This limitation greatly affects what a person can do with his or her retirement savings plan. Although there might be choices as to which specific annuities and mutual funds can be invested in, there is still really no comparison to the vast array of investment choices available in a self-directed IRA.

These can hold, for example, commercial and residential real estate, foreign currencies, oil and gas properties, raw land, and publicly traded or private stocks, bonds, and mutual funds are available to invest in. And this is only a small list of what is open to someone with a self-directed IRA. More choices means a more diverse portfolio which is less vulnerable to changes in the market and has a better chance of getting high returns.

If a 403(b) isn't making the amount of money desired, there are definitely other options out there. City Capital Corporation provides its clients with access to real estate investments. The company buys homes or even whole neighborhoods, then renovates them to make them attractive to working-class families who want a home. These homes are then sold to buyers on a pre-approved list, and the whole process generally takes about 4-6 weeks.

Instead of relying on impossibly high returns on each individual house, the company invests and reinvests the money multiple times within the year. Modest returns on each property add up rather quickly, and this allows the company to offer rates of return of 30%, and even higher in many cases. As those who have dealt with retirement savings accounts before would surely know, having a selection of annuities and mutual funds in a retirement account will almost never give returns even close to that high, so why stick with those?

There is also no reason to worry that things will get too complicated by switching. Although having a self-directed IRA has some extra work that needs to be done, City Capital does all of the work after the initial set up period, and all clients have to do is sit back and see their investment money grow like never before. With all these benefits, sticking to a 403(b) plan is simply a case of missing out on opportunity.

Ephren W. Taylor II first revealed his extraordinary knack for making money at age 12 and he hasn't slowed down since. He was a self-made millionaire while still in his teens. In his twenties he became the youngest African-American CEO of any publicly traded company ever, City Capital Corporation (CTCC). Today Taylor and City Capital oversee tens of millions in assets for clients ranging from entertainment icons and pro athletes to church members and private companies. He is a dynamic speaker and author of the best seller "Creating Success from the Inside Out." Learn more at CashFreeInvesting.com, IRACashFlow.com or Ephren.com.

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