When regulation changed in 2007, many proclaimed the end of 403(b)s, but with the emergence of new technology and solutions, these plans have vastly improved. (Photo: Shutterstock)
The 403(b) plan has been around for more than five decades. That makes 403(b)s some of the oldest defined contribution plans on the market – but much has changed since they were first introduced. As retirement advisors, it's important to know the nuances of these plans and how they've evolved so you can properly inform your plan sponsor clients about specific compliance requirements, maximize your role, and support better outcomes for participants.
|The advisor's role hasn't evolved much
In the beginning, 403(b) plans were retirement arrangements with only a fixed-annuity option: 403(b)(1) annuity accounts.
In those early days, employees would select their fixed-annuity option, the employer would deduct a pre-tax contribution from the employee's paycheck and forward the selection to the selected insurance company.
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