There is a lot of talk in the finance space about 401ks. While corporate employees are typically the beneficiaries of these plans, those of you who work for non-profits, hospitals, or educational institutions may be more familiar with a similar retirement savings plan, the 403b.
Just as a 401k does, a 403b provides you with a tax-advantaged way to save for retirement. You benefit from tax-free growth over time and depending on the options your employer offers, you’ll also get a tax break on either current contributions (Traditional) or future withdrawals (Roth).
When you leave a job where you have a 403b, you have a few options for what to do with your retirement savings:
Leave it in your old employer’s account.
Roll over your 403b into your new employer’s 403b or 401k.
Roll over your 403b into an Individual Retirement Account (IRA).
Rolling over your 403b into an IRA can be a good choice because it gives you more control over your investment options, tends to have lower fees, and can ultimately hold funds from all of your previous work retirement accounts.
Rolling over a 403b
Initiating your 403b rollover takes just a few minutes. Sign into your Betterment account (or create one if you haven’t already) and click “Rollover” at the top right of your screen.
Answer simple questions about your 403b provider, the type of funds held in your account and its estimated value. Betterment will then send you an e-mail with details on how to complete the transfer. You’ll have to contact your 403b provider to authorize the release of your funds to Betterment and then your provider will either send a check directly to Betterment or send it to you to forward.
Depending on how quickly your former provider releases the funds, the process can take a few days or weeks to complete. Once Betterment has received the funds, you will receive a confirmation e-mail and be able to see your new IRA account on your online dashboard.