Roth 457(b) Deferred Compensation Plan (DCP)

A Roth 457(b) is a Deferred Compensation Plan (DCP) that allows employees of educational institutions and certain tax-exempt organizations to save after-tax dollars for retirement. A Roth 457(b) works much like a Roth 403(b) plan in terms of taxes and loans and can offer another way to save for retirement. Some school districts sponsor Roth 457(b) plans in addition to offering a Roth 403(b) plan.

The RBFCU Retirement Program is available to employees in school districts and certain tax-exempt organizations within the state of Texas. With our financial advisors, you can create a plan you’ll feel confident about.

What you should know about a Roth 457(b):

Tax form and calculator


Contributions are made to your Roth 457(b) after taxes are taken from your paycheck, allowing your earnings to grow — and withdrawals to be taken — tax-free if the account has been open for at least five years and you are age 59½ or older. Roth 457(b) money is subject to required minimum distribution rules.

Hand withdrawing money


Regardless of age, you may withdraw from your Roth 457(b) when you leave your employer, or in the case of death or unforeseen emergency.

Hand giving money


If plan allows, a loan may be taken against your Roth 457(b) funds regardless of your employment status. Repayment terms and interest rates are determined by your investment provider. Certain rules may apply.

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To learn more about the RBFCU Retirement Program and benefits of enrolling, contact us at:

  • What will my income be after I retire?
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  • What will my expenses be after I retire?
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  • How much can I contribute to a 457(b) plan?
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    In 2023, you may contribute up to $22,500 to a 457(b). If you are over age 50, you may contribute an additional $7,500 annually in 2023. This limit is separate from the 403(b) limit.

  • Are there any additional contribution catch-up provisions for the 457(b) plan?
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    Depending on your district plan, for the year 2023, you may be able to add up to an additional $22,500 in addition to the standard limit of $22,500. This cannot be used with the age 50+ catch-up provision. This catch-up is used during your final 3 years before retirement age (deemed as age 62 or 65, depending on your district plan). You must qualify every year through your district’s administrator.

  • What is the difference between a 457(b) plan and a 403(b) plan?
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    Both types of plans are tax deferred, but the 457(b) lets you start withdrawing money from your account as soon as you stop working for the sponsoring employer, no matter your age or in the case of death, disability or unforeseen emergency, regardless of your age if certain requirements are met. Meanwhile, 403(b) plans allow standard, penalty-free withdrawals at age 59½, as well as limited early withdrawal exceptions.

Investment products are not insured by the FDIC, NCUA or any federal agency, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value.

Ameriprise Financial Services has a partnership with this financial institution to provide financial planning services and solutions to clients. The financial institution is not an investment client of Ameriprise but has a revenue sharing relationship with us that creates a conflict of interest. Details on how we work together can be found on

Ameriprise Financial is not affiliated with the financial institution.

RBFCU Retirement Program, a financial advisory practice of Ameriprise Financial Services, LLC, is a division of RBFCU Investments Group LLC.

The initial consultation provides an overview of financial planning concepts. You will not receive written analysis and/or recommendations.

A Roth IRA is tax free as long as investors leave the money in the account for at least 5 years and are 59 1/2 or older when they take distributions or meet another qualifying event, such as death, disability or purchase of a first home.

Ameriprise Financial, Inc. and its affiliates do not offer tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.

Investment advisory products and services are made available through Ameriprise Financial Services, LLC, a registered investment adviser.

Securities offered by Ameriprise Financial Services, LLC. Member FINRA and SIPC.