​Retirement Planning

Plans for Educators and Not-for-Profits

Our companies have been providing retirement solutions for employees of not-for-profit organizations for more than 35 years. We have the expertise and knowledge to support the needs and requirements of these marketplaces. We will work with you and your insurance professional to be sure that you have chosen a plan that meets your needs. You can then count on us to provide high-quality service for years to come.

Types of Plans

There are as many types of retirement plans as there are reasons for establishing a plan. Selecting one can be overwhelming. We are ready to work with you and your financial professional to evaluate your organization's retirement plan needs.

Employee 403(b)

Employee 403(b) plans are tax-sheltered retirement annuities for employees of certain tax-exempt employers that receive only employee deferrals through salary reduction agreements. Public schools, universities, colleges and non-profit 501(c)(3) organizations are eligible to establish this type of plan.

Employer 403(b)

Employer 403(b) plans are tax-sheltered retirement annuities for employees of certain tax-exempt employers that may receive employer discretionary contributions and/or employee deferrals and employer-matching contributions. Public schools, universities, colleges and non-profit 501(c)(3) organizations are eligible to establish this type of plan.

457(b) Governmental

A 457(b) governmental plan is a deferred compensation arrangement of an eligible employer. States, political subdivisions of a state and their agencies or instrumentalities, public schools, universities and colleges are eligible to establish this type of plan.

457(b) Non-Governmental

A 457(b) non-governmental plan is also a deferred compensation arrangement of an eligible employer. However, only non-governmental tax-exempt organizations may establish this type of plan.

What to Consider

There are some decisions you'll need to make to put your plan in place, and certain things you will need to consider when choosing an appropriate retirement plan for your organization.

  • Will you match employee contributions?
  • How long do employees need to be with your organization to be vested in contributions you make on their behalf?
  • How will you administer the plan?

We can assist you with these questions and more.

Cost to Your Organization

You will need to consider the costs of administering a retirement plan, and whether you will choose to use a third-party administrator or the cost of staff time that it takes if you choose to administer it yourself.

Limits on Contributions

Each year the IRS sets limits for each type of plan for the amount that can be contributed. The limits are set to increase based on inflation in the coming years. Your insurance professional has the most up-to-date information to share with you.

Tax Law

Contributions to a qualified retirement plan grow tax deferred. That means taxes will not be due on any of the contributions until a participant receives a distribution. All distributions are subject to ordinary income tax, and there may be an additional 10% penalty tax if taken before age 59½. Consult your tax professional for full details.

Loans

Depending on the type of plan you choose, loans may be made available to participants, allowing them to access part of what they have contributed prior to retirement. Any time a loan is issued, the participant's contract value is used as collateral for the loan. Participants should carefully consider the impact of a loan on their retirement account and consult a tax professional for more information.

If you have questions about establishing a retirement plan for your educational or not-for-profit organization, contact us at 800 438 3398, ext. 17197, or send us an e-mail at DirectConnectTeam@gafri.com.


Note: The above information is not intended or written to be used as legal or tax advice. It was written solely to provide general information and support the sale of annuity products. A taxpayer cannot use it for the purposes of avoiding penalties that may be imposed under the tax laws. You should seek advice on legal or tax questions based on your particular circumstances from an independent attorney or tax advisor.

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