NYS Deferred Compensation Plan Management

Make the Most of your 457

Customized Solutions for First Responders, Government and Nonprofit Employees

While defined-benefit (DB) pension plans may still be a cornerstone of many public sector retirement plans, national statistics show 457 plans becoming more popular for public service employees to save on a tax-deferred basis with benefits like “catch-up contributions” and more diversification. Because employee participants are often already enrolled in a defined benefit plan (where only the employer contributes), they may not know of the additional benefits a 457 plan can offer for retirement planning, including catch-up contributions for saving and even early retirement options.

Opening a Window of Investment Options

Employers, wanting to give their employees additional choices within their retirement plans, have chosen to augment retirement plans (401k, 403b, and 457s) over the years by offering a brokerage window, also referred to as a Self-Directed Brokerage Account (SDBA). SDBA windows have been integrated into more than 100,000 group retirement plans for participants across the United States, and these windows give employees more options, for more customized planning. Most SDBA options also allows employees to seek professional in-plan financial advice on their assets. Employees using financial professionals for advice often make more informed investment decisions for a more holistic, goals-based approach to retirement, inside and out of their group plan.

How Does SDBA Management Work?

If your 457 offers SDBA, it means that you have additional options beyond what is offered by your employer in the “Core” part of your plan. Your savings can move from the Core part of the plan through a window that you open. Once you open the window you can get customized advice from your advisor.