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403B vs. Roth IRA

July 29th, 2013 at 05:34 am

For the past few years, I've managed to contribute $6,500.00 to an AXA Equitable 403B account (deducted from payroll) and about $2K to a Roth IRA (electronically funded). This past June, I stopped the contributions to prepare ourselves for a summer with no income. I do want to resume my retirement contributions as of October 1st because I am playing catch up when it comes to my retirement. I was a stay-at-home mom until 2006 when I began working full time. I think I am going to switch my contributions so that I can fully fund the ROTH IRA and contribute the rest to the 403B. What do you think, should I contribute the most money to the 403B or Roth?

P.S. The 403B is not match by my employer. I'll be vested in a New Jersey PERS (Public Employee Retirement System) in another two years.

3 Responses to “403B vs. Roth IRA”

  1. rob62521 Says:

    Suze Orman would say fully fund your Roth first if your 401K or 403b isn't matched. That's what I try to do because my 403b isn't matched either.

  2. baselle Says:

    Roth. For the tax breaks of course, but since you can withdraw the contributions, the Roth can double as the Plan C/D/E emergency fund, which would be useful during furloughs and summers.

  3. MonkeyMama Says:

    A regular IRA or ROTH IRA would be better than 403b. Less hidden fees/more choices. (You can basically invest about anywhere).

    The 403b gives you an up front tax break, but so would a regular IRA. So you may want to think along the lines of Regular IRA versus ROTH IRA.

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