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Old 05-15-2013, 12:41 PM
 
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I am currently working in Industry and contribute to 401K, though there is no employer side contribution.

I am planning to join the Academic position starting Aug 2013.

The University offers 401A plan with the contribution from the employer side as well. In addition, I believe they encourage to contribute in 401K, 403B etc.,

Question I have is, does the 401K contribution limit of $17500 applies to the combined total 401K and 401A/403B contribution for the year 2013.

I meant to ask does 401K+401A/403B contribution should not be above $17500 for the year 2013.

If that is NOT the case, I am thinking if I can maximize the 401K savings before Aug, while I am in Industry and start contributing to 401A from August

Please advice.
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Old 05-15-2013, 01:01 PM
 
Location: Living on the Coast in Oxnard CA
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The limits are the same for both, for 2013 $17,500.

401K is for private sector employment while a 403B is for not for profit organizations such as schools, hospitals and other organizations.

Our employer pays 2% of our yearly income into the 403B even if we do not participate. They also offer a half % match up to the 6% level. (We pay 1% they pay a half %, We pay 6% they pay 3%.) For us, paying just 6% of your income brings you to 11% going into your account without you doing anything else. Not a bad investment if you ask me.

Limits are for all 401K, 403B accounts combined. Lets say that you work your 9 to 5 and they offer a 403B account and then you get a second job that offers a 401K account. The total that you can invest is still only $17,500 for 2013. (It has been going up about $500 a year.) Invest more and the IRS will tax you on the additional amount.

Something that you could do though if you get married then both you and your spouce can contribute $17,500. Also if you do max out that amount you could get an IRA and max that our at $5,000 I think? (Married that would increase to $10,000.)

Last edited by SOON2BNSURPRISE; 05-15-2013 at 01:11 PM..
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Old 05-15-2014, 01:53 PM
 
Location: Mount Laurel
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There is a 15-year catch up in 403b that is not available in 401K. If one qualified, the max for 403b for 2014 is $20,500.

In your case, it doesn't make a difference as you are just starting out a 403b.
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