Tax-Sheltered Annuity Plan
A 403(b) is a tax-advantaged retirement plan offered to employees of public schools, 501(c)(3) nonprofits, and certain ministers, functioning similarly to a 401(k).
Unlike a 401(k), 403(b) plans have historically been built around annuity-based investment contracts through insurance companies, which can carry higher fees than typical mutual funds — though newer plans increasingly offer lower-cost options.
It's basically the 401(k) for teachers, nurses, and nonprofit workers — same tax benefits, but with a history of higher-fee investment options that many people never realize they're paying.
What to check for fees, and your real rollover options.