Summary of 457(b) Plans

457b plans are perhaps the least-known sibling in the family of major retirement plans. Their rules are complex, and there are several varieties of them, but they have changed over the years to become simpler and more in line with other plans. They offer some attractive advantages that other plans do not, such as the lack of a penalty on early distributions (i.e., if you leave a job before age 59½) and the ability to contribute extra if you are near retirement.

If you work in government or a non-profit organization and are eligible for a 457 plan, it may pay to consult with your employer or human resources department to see whether a 457 plan is a good idea for you.