457(b) Retirement Plan Guide
Tax-advantaged retirement plan for government entities
457(b) Testimonial
Did not hesitate to give Langan Financial a 5-star review.
First met Bob when he took over management of my employers deferred comp program which was previously managed by a very large, national financial company who in the previous 10+ years I participated, never saw or spoke to a representative.
Couple things immediately caught my attention, Langan Financial management fees were significantly less thus allowing my account to grow more, they offered to schedule a review with each participant, they came in and did group lunch & learn sessions 2 times a year that were NOT sales pitches but truly basic information on investing and the advantages of having a financial plan.
They offered 1 on 1 meetings with every employee, whether a deferred comp participant or not to review their finances and make suggestions, no sales pitches.
I am so glad I listened to Bob & his team since they played a major role in allowing me to now enjoy a financially stress free retirement. I continue to meet with Langan Financial on a regular basis to review my investments and have never felt pressured or listened to a sales pitch.
The entire team is a pleasure to work with and I highly recommend Langan Financial for financial planning & guidance.
A note about this testimonial: The individual providing the testimonial above is a current client of Langan Financial and were not compensated for providing their testimonial. The testimonial reflects their individual experiences and are not representative of the experience of all clients.
What is a 457(b) Retirement Plan?
A 457(b) Retirement Plan is a form of deferred compensation plan offered by state and local government employers under section 457(b) of the Internal Revenue Code.
The plan structure is similar to that of a 401(k) plan, but there are unique differences that benefit the employee.
By taking advantage of a 457(b) retirement plan, pre-tax money can grow untaxed until the participant is ready to retire. At this point, it will then be used as retirement income.
457(b) Max Contributions
For 457(b) contributions, employees can divert part of their salary, either pre or post-tax, into a retirement account.
Employee contributions to the plan come from a percentage of their paycheck up to the contribution limit.
This gives the participant the benefit of lowering taxable income, which is common for qualified deferred contribution plans. The contribution limit is:
- $24,500 in 2026
- $23,500 in 2025
- $13,000 in 2024
Additional catch-up contributions may be available, depending on the participant’s age, proximity to the plan’s normal retirement age, and plan provisions.
These contributions are contributed through salary reductions in accordance with the Internal Revenue Code 402(g).
457(b) Catch-Up Provision
Catch-up contributions may allow eligible participants to save more as they approach retirement.
In 2026, a governmental 457(b) plan may permit participants age 50 or older to contribute an additional $8,000, increasing the total contribution limit to $32,500.
Participants ages 60–63 may qualify for a higher catch-up contribution of $11,250, bringing their total to $35,750.
A 457(b) plan may also offer a special catch-up during the three years before the plan’s normal retirement age.
In 2026, this provision may increase the contribution limit to as much as $49,000, depending on the participant’s unused contribution limits from prior years.
Participants cannot use the age-based catch-up and the special three-year catch-up in the same year.
Employer contributions are permitted, although they count toward the applicable 457(b) contribution limit. Catch-up options depend on the type of 457(b) plan and its provisions.
457(b) Plan Withdraws
Governmental 457(b) plans offer flexibility when retirement comes early.
After separating from employment, participants can generally withdraw funds before age 59½ without the additional 10% federal early-withdrawal tax.
An exception may apply to money rolled into the plan from another type of retirement account.
Withdrawals of pre-tax contributions and earnings are generally subject to ordinary income tax, while qualified Roth distributions may be tax-free.
Required minimum distributions generally begin at age 73, increasing to age 75 for individuals born in 1960 or later.
Some workplace plans may allow participants who remain employed to delay RMDs until retirement.
If an RMD is missed or is too small, the federal excise tax is generally 25% of the amount not withdrawn.
The tax may be reduced to 10% if the shortfall is corrected within the applicable correction period.
457(b) Distributions
457(b) plans may offer distributions for unforeseeable emergencies. These emergencies can include:
- Illness or accident of the participant, participant's beneficiary, spouse, beneficiary's spouse, or dependents
- Property loss caused by casualty of the participant or beneficiary
- Funeral expenses of the participant's spouse or dependent
- Other similar extraordinary and unforeseeable circumstances
In order to receive the distribution, the participant must show the emergency expenses could not have been covered by insurance, liquidation, or other means.
Loans in a 457(b) governmental plan may be allowed, however, loans in a 457(b) of non-governmental tax-exempt employers are not.
It is important to note which organization has the 457(b) as some offerings may differ.
457(b) Benefits
A 457(b) retirement plan presents a great opportunity for public employees to save for retirement.
Some of the advantages that come from a 457(b) plan are the ability to lower taxable income and the lack of withdrawal penalty fees.
457(b) Cons
There are some cons such as very few employers offering a contribution match and a lower contribution limit than a 401(K).
The plan structure can seem complex, which is why it is always a good idea to consult with a financial advisor.
457(b) Plan Advisor Services
Langan Financial Group has been working with retirement plans, including 457(b) plans, for over 35 years.
We help provide retirement plan advisory services to numerous municipalities and government employees.
Langan Financial Group will work with organizations to help ensure their retirement plan is providing the best value to the organization and employees it can.
We will:
- Review the plan's design to ensure it aligns with your goals and needs
- Review the plan to ensure it is doing what it is supposed to be doing
- Benchmark the plan to help keep costs competitive
- Benchmark the plan to help keep the organization's liability low
- Engage the employees through financial seminars, one on one financial planning, and other methods to help them with retirement planning
Get started today
Contact Us Today
Chat with a 457(b) Advisor
Langan Financial Group's 457(b) advisors have over 50 combined years of experience servicing retirement plans for organizations. Give us a call at 717-288-1880 to see how our local advisors can help with your retirement plans.
Or visit our retirement advisor contact page to fill out an inquiry.
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Financial Advisor Locations:
Camp Hill, PA Financial Planning Office
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Langan Financial Group, LLC ("Langan Financial Group" or "LFG") is an SEC registered investment adviser. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability. LFG may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements.
Important information about our firm is on our Disclosures page. You can review our registration and disciplinary history on the SEC's Investment Adviser Public Disclosure (IAPD) website and, for brokerage registrations, on FINRA's BrokerCheck. This website is for general information only. It is not legal, accounting, or tax advice. Please talk with your own legal or tax professional about your situation. Important information about our firm is on our Disclosures page.
You can review our registration and disciplinary history on the SEC's Investment Adviser Public Disclosure (IAPD), website and, for brokerage registrations, on FINRA's BrokerCheck.
This website is for general information only. It is not legal, professional about your situation.
© Langan Financial Group
Harrisburg, PA Office
Address: 1863 Center St, Camp Hill, Pa 17011
Phone: 717-288-1880
York, PA Office
Address: 3405 Board Rd, Suite 200, York, Pa 17406
Phone: 717-773-4085
