I had a subscriber ask about the double contributions in your last 3 years in a 457 plan. I try to answer the do’s and don’ts and how it works.
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Can you do the 3 year catch-up plan even if you have a Roth 457b plan? I recently switched from a tax deferred to a Roth 457b and plan to retire in 6 years.
Great and very informative video!
Thank you for sharing.
Okay, I have another scenario for you. My defined benefit pension allows me to take a partial lump sum payout equal to two years of regular distributions (for a reduced monthly benefit). Can I deposit that lump sum amount tax free into my 457, or would I have to open a different account such as an IRA to do that? Thanks.
That's still a few years off for me.
You may want to consider starting the 3 catch-up earlier if you meet the criteria for normal retirement. I chose to start the three-year catch up last year at age 48(I should have done it at 47). The reason for starting earlier allows me to contribute $36,000 at a age where I would have only been able to contribute 19,500. This also gives me the benefit of having a larger amount of money with more time to compound. Once I complete the three years of catch-up I'm still allow to contribute the normal contributions amount plus $6000 for being over the age of 50.