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What is the difference between a 401k, IRA and a 403b?
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A 401k, an Individual Retirement Account (IRA), and a 403(b) are all retirement savings plans. They differ in terms of eligibility requirements, contribution limits, tax benefits, and investment options. A 401k plan is typically offered by employers to their employees as part of their compensation package. An IRA is an account that individuals can set up on their own or through their employer. It allows you to save for retirement with pre-tax contributions. Finally, a 403(b) is an option available to certain public sector workers such as teachers and police officers. Contributions to this type of plan are made with after-tax dollars and there are no income restrictions.