457(b) Retirement Plan

  • EWSD employees also have the option of deferring money into a 457(b) plan.   A 457(b) plan works similar to a 403(b) plan in that eligible employees can supplement any existing retirement/pension benefits by saving and investing before-tax dollars through voluntary salary deferral (i.e. payroll deduction).   EWSD Employees have the unique opportunity to contribute to both the 403(b) and the 457(b) Plans should they choose to do so. 

    How does the 457(b) Plan differ from the 403(b) Plan?

    Both the 403(b) Plan and the 457(b) Plan allow employees to save for their retirement by saving and investing pre-tax dollars through voluntary deferrals (i.e. payroll deductions).   Similarly, both the contributions and any earnings under the plans are tax-deferred until the money is withdrawn, usually at retirement when individuals tend to fall into a lower tax bracket.  When the funds are withdrawn, they are subject to regular income tax.

    Aside from the investment options that differ between the plans, one of the primary differences between the 403(b) Plan and the 457(b) Plan is that under the 403(b) Plan, withdrawals can be subject to a 10% tax penalty if withdrawn prior to age 59 1/2.   This 10% federal tax penalty does not apply to distributions from a 457(b) Plan prior to the age of 59 1/2.   

    What is the maximum amount I can contribute?

    457(b) Plan

    403(b) Plan

    Up to $18,500 in 2018, and

    Up to $18,500 in 2018, and

    An additional $6,000 more in 2018 if you are age 50 or older

    An additional $6,000 more in 2018 if you are age 50 or older

    Potential maximum combined contribution in 2018

     $18,500 + $18,500 = $37,000 (under age 50)

    $24,500 + $24,500 = $47,000 (age 50 or older)

    The limit on annual additions (the combination of all employer contributions and employee elective deferrals to all 403(b) accounts) is the lesser of $55,000 for 2018 or 100% of includible compensation.  

    How do I enroll? 

    To enroll, employees need to complete a Salary Reduction Agreement (indicating the amount of their contribution) and an Participant Enrollment form (indicating your investment choices).   If you have more than one Primary Beneficiary or one Contingent Beneficiary, please also complete a Beneficiary Designation form.   The completed forms should be submitted to the Payroll Department at the central office at the following address:  Essex Westford School District, Attn: Payroll Office, 51 Park Street, Essex Jct., VT 05403.

    Who is the Investment Provider for the 457(b) Plan?

    The District's 457(b) Plan is also with the Vermont State Employees Retirement System which is currently administered by Prudential.  For information about the investment options available under the Vermont State Employees Retirement System 457(b) Plan, or to access your account, please visit them on-line at: vermont.retirepru.com.

    Who do I contact with questions?

     For more information about the 457(b) Plan, please contact our Prudential Investment Counselor, Brian Ficek, at (802)222-1798 or email him at brian.ficek@prudential.com.

Retirement Plan Forms and Documents