What is the 403(b) contribution limit for 2026?

The 403(b) employee contribution limit for 2026 is $24,500 — the same as the 401(k). Workers age 50–59 or 64+ can add an $8,000 catch-up, and workers age 60–63 get a SECURE 2.0 super catch-up of $11,250.

What is the 403(b) 15-year rule?

The 15-year rule is a special catch-up contribution available only to 403(b) participants who have at least 15 years of service with the same employer. It allows an additional $3,000 per year (up to a lifetime max of $15,000). This catch-up applies before the age-50 catch-up and must be used first.

Can I contribute to both a 401(k) and a 403(b)?

Yes, if you work for an employer that offers a 403(b) and also have a 401(k) from a side job or different employer. However, the combined employee elective deferral limit applies across all plans at the same employer — $24,500 total in 2026.

What's the difference between a 401(k) and a 403(b)?

The biggest practical differences are: 403(b)s are only available to employees of public schools, hospitals, non-profits, and churches; 403(b)s have an additional '15-year service' catch-up contribution that 401(k)s don't; 403(b)s historically had limited annuity-based investment options, though most now also offer mutual funds. Contribution limits, tax treatment, and RMD rules are identical.

401(k) vs 403(b) 2026: Which Plan Is Better?

Eligibility

Who Has Access to Each Plan?

The biggest difference is who the employer is — not the account mechanics.

📊 401(k) — Private sector employers

Corporations (public and private)
S-corps, LLCs, partnerships
Small businesses
Self-employed (Solo 401k)
Startups and tech companies

🏫 403(b) — Tax-exempt employers

Public schools, K-12 and university
Hospitals and health systems
Non-profit organizations (501(c)(3))
Churches and religious organizations
State and local government agencies (some)

Side-by-Side

Full Feature Comparison

Feature	401(k)	403(b)
Who Offers It	For-profit employers	Non-profits, schools, hospitals, churches
2026 Employee Deferral Limit	$24,500	$24,500
Age 50+ Catch-Up	+$8,000	+$8,000
SECURE 2.0 Super Catch-Up (Age 60–63)	+$11,250	+$11,250
15-Year Service Catch-Up Exclusive to 403(b)	Not available	+$3,000/year ✓ $15,000 lifetime max
Total Annual Additions Limit Employee + employer	$72,000	$72,000
Employer Match / Contribution	Varies — common in private sector	Varies — less common in non-profit sector
Tax Treatment	Traditional (pre-tax) or Roth (after-tax)	Traditional (pre-tax) or Roth (after-tax)
Investment Options	Mutual funds, ETFs, target-date funds	Historically annuity-heavy; now often includes mutual funds
Early Withdrawal (before 59½)	10% penalty + taxes	10% penalty + taxes
RMD Start Age	Age 73	Age 73
Loan Provision	If plan allows (50% / $50k max)	If plan allows (50% / $50k max)
ERISA Coverage	Yes (most plans)	Yes (most plans; churches may be exempt)
Dual 457(b) Stacking	Not typically available	Some 403(b) employers also offer 457(b) ✓

403(b) Exclusive Feature

The 403(b) 15-Year Service Catch-Up

This is the one meaningful advantage a 403(b) has over a 401(k) — an extra catch-up for long-tenured employees.

📜 How the 15-Year Rule Works

Who qualifies403(b) participants with ≥15 years at same employer

Extra annual catch-up+$3,000 per year

Lifetime maximum$15,000 (5 years × $3,000)

Age requirementNone — applies before the age-50 catch-up

Ordering rule15-year catch-up is used first; age-50 catch-up is second

AvailabilityOnly if the plan allows it — check your plan documents

Example: A teacher with 20 years at the same school district who has never taken advantage of this rule can contribute an extra $3,000/year for up to 5 years — potentially $15,000 in additional tax-deferred savings.

Strengths & Weaknesses

Pros & Cons

📊 401(k)

Pros

Employer match more common and often more generous in private sector
Broader investment menus with lower-cost index funds
Widely available — most large employers offer one
Well-established regulatory framework (ERISA)
More competition among providers drives lower fees

Cons

No 15-year service catch-up option
Plan quality varies significantly — some have high fees or limited fund selection
Generally not stackable with a 457(b) from the same employer

🏫 403(b)

Pros

15-year service catch-up: extra $3,000/year (up to $15,000 lifetime) for long-tenured employees
May stack with a 457(b) if your employer offers both — double contribution room
Same limits and tax advantages as a 401(k)
Church plans may have more flexibility from ERISA requirements

Cons

Historically saddled with high-fee annuity products — always review your investment options
Employer match less common in non-profit sector
403(b) providers vary widely in quality; some still use variable annuities with surrender charges

💡 The 403(b) + 457(b) Double-Dip: Many government and non-profit employers offer both a 403(b) and a 457(b) plan. These have separate contribution limits — meaning you could contribute $24,500 to your 403(b) AND another $24,500 to your 457(b) in the same year. That's up to $49,000 in employee deferrals — one of the best tax-deferral opportunities in the US tax code. Check if your employer offers a 457(b) alongside your 403(b).

FAQ

Common Questions

Can I roll over a 403(b) to a 401(k) or IRA when I leave my job?

Yes. A 403(b) can be rolled over to a traditional IRA, another 403(b), or a 401(k) — tax-free if done correctly as a direct rollover. This gives you more investment flexibility after leaving your employer, especially if your 403(b) had limited or expensive options.

What is the difference between a 403(b) and a 457(b)?

A 457(b) is available only to government employees (and some non-profits) and has a unique advantage: there is no 10% early withdrawal penalty if you separate from service, regardless of age. This makes it very useful for public safety workers who retire early. Many public sector employees have access to both a 403(b) and a 457(b) with separate contribution limits.

Do 403(b) plans still use annuities?

Historically, 403(b) plans were annuity-only. Today, most modern 403(b) plans also offer mutual funds. However, many legacy plans (especially in public school districts) still default to or heavily feature variable annuities, which can carry high fees and surrender charges. Always review the expense ratios of your 403(b) investment options and compare to low-cost index funds if available.

Can I have both a 403(b) and an IRA?

Yes. Contributing to a 403(b) does not affect your IRA contribution limit — you can still contribute up to $7,500 (or $8,600 with catch-up) to a Traditional or Roth IRA in 2026. Note that having a 403(b) makes you "covered by a workplace retirement plan," which may limit your Traditional IRA deductibility depending on your income.