GET STARTED
HAVE YOU STARTED SAVING FOR RETIREMENT
WITH THE TEXA$AVER PROGRAM?
IF NOT, IT’S AS EASY AS 1 … 2 … 3!
2. DECIDE HOW MUCH TO CONTRIBUTE
Start saving at least 1% or $20 per paycheck either with pre-tax or Roth after-tax 457 plan contributions.
3. CHOOSE YOUR INVESTMENTS
Select a target date fund or a variety of core funds, or open
a self-directed brokerage account (SDBA). The SDBA is
intended for knowledgeable investors who acknowledge
and understand the risks associated with the investments
contained in the SDBA. For more fund information, visit the
Texa$aver website.
Are you are looking for additional help? Try the two levels of
service offered by the Texa$aver Advisor Service.
There is no guarantee provided by any party that participation
in any of the advisory services will result in a prot.
DO YOU HAVE
QUESTIONS OR WANT
MORE INFORMATION?
Visit: www.texasaver.com
Call: (800) 634-5091
Email: texasaver@empower.com
Schedule a no-cost meeting with your local
Retirement Plan Advisor by scanning the QR code.
457
Part-time and full-time higher education employees can enroll.*
*Higher education employees may enroll in the 457 plan if their higher education agency offers the plan.
1. ENROLL IN THE 457 PLAN
TWO LEVELS OF THE TEXA$AVER ADVISOR SERVICE
ONLINE
ADVICE
NO ADDITIONAL
COST TO YOU
MANAGED
ACCOUNT SERVICE
FEES APPLY
Online Advice and the Managed Account service are part of
the Texa$aver Advisor Service suite of services offered by
Empower Advisory Group LLC, a registered investment adviser.
457 PLAN 403(b) PLAN (Not available through Texa$aver)
Contribution Options
You have the flexibility to designate all or a portion of your contributions as either
traditional pre-tax or Roth after-tax (Roth) contributions.
Contact your 403(b) administrator to see what it allows.
Maximum Annual Deferral
The 2023 annual contribution limit is $22,500 per year.
1
The limit is $30,000 if you are
50 or older. You may put money in as either pre-tax, Roth or both. Employees of higher
education agencies that have elected to offer Roth can participate in the Roth option.
99% of 403(b) eligible compensation or $22,500 per year,
whichever is less.
1
The 2023 annual contribution limit is
$30,000 if you are 50 or older.
Transfer of Funds to
Purchase Service
You may purchase military service, additional service credit, or refunded or other eligible
ERS/TRS service credit by transferring funds from your Texa$aver program account while
employed. This is not a taxable distribution.
Contact your 403(b) administrator to see what it allows.
Rollovers/In
If eligible, you may roll over funds from another eligible retirement plan or individual
retirement account (IRA). Any money you roll in that was subject to the 10% early
withdrawal penalty continues to be subject to the penalty if taken from the account before
you are 59½. Rollovers from other eligible governmental 457 plans will not be subject to
an early withdrawal penalty if directly rolled into the Texa$aver 457 plan. Roth IRAs are
not accepted. Only designated Roth accounts from another eligible retirement plan can be
rolled over into your Texa$aver 457 plan. Consider all your options and their features and
fees before moving money between accounts.
Contact your 403(b) administrator to see what it allows.
Age 50 and Over Catch-up
If you are age 50 or older, you may contribute an additional $7,500 in 2023 for a total of $30,000 to each plan.
1
This includes pre-tax and Roth
contributions combined. You may not use this provision in the 457 plan while using the special 457 catch-up provision.
Special 457 Catch-up Provision
Cannot be used with the age 50 and
over catch-up in the 457 plan
Subject to eligibility. If you have unused deferrals, the special 457 catch-up limit is
$45,000 in 2023. You may participate only during the three years before the taxable year
in which you attain normal retirement age.
Not available in a 403(b) plan.
Loans
Loans may be approved for $1,050 to $50,000 (subject to plan and IRS provisions). You
must have an account balance of at least $1,050 as there is a $50 loan application fee
that is deducted from the loan proceeds. There is a $2.08 monthly maintenance fee
assessed to your account until your loan is paid in full. Loan withdrawals and payments
are prorated from pre-tax and Roth contributions.
Loans may be available to the extent provided by the
annuity contract or custodial account. Contact your
403(b) administrator to see what it allows.
Financial Hardship Withdrawals
2
Only allowed through approval when
you have no other resources, including
plan loans
Reasons for financial hardship include prevention of eviction or foreclosure from your
primary residence, non-reimbursed medical expenses, funeral expenses, casualty loss or
similar extraordinary and unforeseeable circumstances.
Reasons for hardship may include purchase of a primary
residence, prevention of eviction or foreclosure from your
primary residence, tuition expenses, funeral expenses or
non-reimbursed medical expenses. Contact your 403(b)
administrator to see what it allows.
Distributions While Employed for
Pre-Tax Contributions
If your 457 plan account has less than $5,000 and has been inactive for two years,
you may take a
de minimis
distribution; 20% may be withheld for federal income tax
purposes. You can take a distribution if you are 72 (or age 70½ if you reached 70½ on or
before 12/31/2019).
You may be eligible to take a distribution from your 403(b)
plan after age 59½ while still employed without a 10%
early withdrawal penalty; 20% is withheld for federal
income taxes unless funds are rolled to a qualified plan.
Distributions After
Separation From Employer
for Pre-Tax Contributions
You can start taking distributions after separation from state or higher education
employment. You may roll over funds into other types of employer-sponsored plans, IRAs or
other eligible options. Lump-sum distributions have 20% automatically withheld for federal
taxes. Periodic distributions are allowed.
You may be eligible to take a distribution from
your 403(b) plan after age 59½ without a 10% early
withdrawal penalty; 20% is withheld for federal income
taxes unless funds are rolled to a qualified plan.
Distributions From
Roth Contributions
Roth money may be withdrawn tax-free no earlier than five taxable years after your first
Roth contribution AND when you: a) reach age 59½ and separate from service with your
employer; b) become disabled; or c) die. Otherwise, earnings on Roth contributions may be
taxed as ordinary income when you take a distribution.
Contact your 403(b) administrator to see what it allows.
Required Minimum Distributions (RMDs) Must begin no later than April 1 following the year in which you turn 72 unless you are still employed.
3
Tax Penalties
No 10% federal penalty tax applies to distributions of 457 money before age 59½. A 50%
federal tax penalty applies if RMDs are not taken at age 72 unless you are still employed by
the state.
3
This applies to both pre-tax and Roth distributions.
A 10% federal penalty tax may apply to distributions made
before age 59½. A 50% federal tax penalty applies if RMDs
are not taken at age 72 unless you are still employed with
the employer sponsoring the plan.
3
Please consider the investment objectives, risks, fees and expenses carefully before investing. For this and other important information, you may obtain mutual fund prospectuses for registered investment
options and/or disclosure documents from www.texasaver.com under Investments or by requesting one from your Texa$aver representative. For prospectuses related to investments in your self-directed
brokerage account (SDBA), contact your SDBA provider. Read these materials carefully before investing.
1 Ceiling is adjusted each year per cost-of-living index. Amount shown is for 2022.
2 Please refer to the IRS website for 401(k) and 457 information on hardship withdrawals.
3 If you reached age 70½ on or before 12/31/2019, you must take RMDs beginning at age 70½.
Both plans are governed by the provisions of the Internal Revenue Code. The State of Texas
401(k) plan began in 1985, and the 457 plan began in 1974.
WWW.TEXASAVER.COM | (800) 634-5091 | TEXASAVER@EMPOWER.COM
Securities offered by the Texa$aver
SM
Program through Empower Financial
Services, Inc. Member FINRA/SIPC. EFSI is an affiliate of Empower Retirement,
LLC; Empower Funds, Inc.; and registered investment adviser Empower Advisory
Group, LLC. This material is for informational purposes only and is not intended to
provide investment, legal or tax recommendations or advice. Securities available
through Schwab Personal Choice Retirement Account® (PCRA) are offered
through Charles Schwab & Co., Inc. (Member SIPC), a registered broker-dealer.
Additional information can be obtained by calling (888) 393-7272. Charles Schwab
& Co., Inc. and Empower Financial Services, Inc. are separate and unaffiliated.
©2022 Empower Retirement, LLC 98960-01-FLY-WF-255647-1122(2134227)
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