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What is the difference between a 401k, a 403b and a 457b?
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The main difference between a 401k, a 403b and a 457b plan is how they are taxed. A 401k plan is funded with pre-tax contributions from an employee’s paycheck and therefore is subject to income taxes when withdrawn. A 403b plan is funded with after-tax contributions from an employee’s paycheck and is not taxed upon withdrawal. A 457b plan is funded with both pre-tax and post-tax contributions and is also tax deferred until withdrawals begin.