The purpose of the 457 Savings Calculator is to illustrate how the 457 can help you save for your retirement. To use this tool you will need to enter the percent you want to contribute each year, your current annual salary, your current age, your current 457 account balance, your age at retirement, your annual rate of return, the employer match rate, and the employer match maximum. This calculator will take all of this information into consideration and then produce a graph that charts the growth of your retirement investments between now and when you retire.
457 Savings Calculator
457 Savings Calculator Overview
A 457 savings plan is a great way to save for retirement, if you’re fortunate enough to qualify for one. But predicting how much of a nest egg you’ll eventually be able to end up with is challenging.
This 457 Savings Calculator is designed to help you make that prediction as accurately as possible. It not only takes into account your annual contributions, projected return on investments and years until retirement, but also allows you to figure in your anticipated growth in salary as well.
You can also play around with the figures by adjusting the sliding indicators to quickly see how variations in such things as your rate of return, annual contributions, salary increases, delaying or hastening retirement, etc. will affect the eventual size of your investment.
About 457 savings plans
A 457 savings plan is a special kind of deferred compensation plan that may be offered to governmental and certain non-governmental employees of non-profit organizations. It’s similar to the more common 401(k) plan but with some key differences.
Like a 401(k), a 457 savings plan allows you to make tax-deferred contributions to a retirement investment account. Your contributions come out of your pre-tax earnings and reduce your tax bill today, and your investments grow tax free. You eventually do pay taxes on the money you withdraw from the account.
A 457 plan is often used as a supplement to a 401(k) or 401(b) savings plan. That’s because while all three currently allow a maximum $18,000 in annual contributions (and potentially an additional $6,000 in “catch-up contributions for those age 50 and above), your 457 contribution maximum may be made in addition to your maximum 401(k) or 401(b) contributions. So you could potentially contribute up to $48,000 a year pre-tax for a 401 and 457 plan combined. Limits include employer contributions.
Unlike a 401 plan, there is no penalty for early withdrawals from a 457 savings plan. Withdrawals are still counted as income for tax purposes, however.
Like 401 plans, there are Roth options for 457 savings plans in which you make post-tax contributions in order to enjoy tax-free withdrawals later on.
Non-governmental 457 plans have certain limitations that governmental 457s do not. First, the earnings are not held in trust for the employee but are regarded as assets of the organization. This means the funds could be forfeited to creditors if the nonprofit goes bankrupt.
Funds in a non-governmental 457 also cannot be rolled over into any other type of retirement account other than another 457.