403b Options Will Change Next Year
403b plans will probably undergo some changes next year. These plans offered by schools, hospitals and non-profits will get more oversight and be similiar to 401k plans. Several 403b experts point out the changes in these employer plans.
But some changes may be less than popular. One perk with many 403(b) plans is the so-called 90-24 transfer (named after the number of the rule) that allows participants to move their money to just about any 403(b) provider, even those unassociated with their employer.
"You have the ability to move money out of a 403(b) at any time without having to consult with the [school] district and ask their permission," said Scott Dauenhauer, a certified financial planner, president of Meridian Wealth Management in Laguna Hills, Calif., and co-author of "The 403(b) Wise Guide."
"You may have surrender charges that you pay, but you have freedom," he said. But starting as early as January 2008, the new IRS rules will likely restrict employees to investment options approved by their employer.
Wise Owl