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Retirement Products |

401(k) and 403(b)

401(k)s and 403(b)(7)s are employer-sponsored plans that allow employees to set aside savings for retirement purposes. Contributions are deducted from your salary automatically, before you receive your paycheck—and before taxes are calculated. Because you report less current income, you pay less current taxes on your pre-distribution income. All of your contributions go straight into your plan. Federal taxes are deferred until you begin receiving income later on. In most cases, state and local taxes are deferred as well.¹

Thanks to the power of tax-deferred compounding, this plan lets you enjoy considerable tax savings throughout your working years and have a nest egg to draw on once you retire. Even modest contributions can grow to a sizable amount when you invest regularly on a tax-deferred basis.

The Potential Advantage of Tax Deferral

Source: Ned Davis, Inc. This example is hypothetical and for illustrative purposes only and is intended to show the effects of tax deferral on two investments over 10, 20 and 30 years. Returns do not reflect fees and expenses of actual investments. It assumes a 6% annual return and a 33% overall income tax rate. Withdrawals from the tax-deferred account are subject to current income tax as well as a 10% federal penalty tax and 20% withholding tax if withdrawn prior to age 59½. The imposition of taxes and penalties will reduce accumulated amounts. Actual results will vary.

Many employers also offer matching contributions to their employees' 401(k) or 403(b)(7) plans. These are contributions made on your behalf by your employer, and they also receive tax-deferred treatment.

Dreyfus funds are investment options in many 401(k)s across the country — check with your employer to see if Dreyfus funds are offered through your plan.

For employees of educational or non-profit organizations, the Dreyfus 403(b)(7) Plan combines the benefits of tax deferral with the investment diversity and flexibility you deserve. This plan enables you to conveniently build assets for retirement through automatic salary reduction — while enjoying significant tax benefits today.

If you're a retirement plan sponsor, learn more about the Dreyfus 403(b)(7) plan now.

Find Out More

Read Frequently Asked Questions about 403(b)(7).

Contact us to speak to a Retirement Specialist or ask your employer if Dreyfus is an option under your 403(b)(7) plan.

1. Upon withdrawal, accumulated amounts and pre-tax contributions will be subject to current income taxes, which will reduce accumulated amounts. Taxable amounts withdrawn prior to age 59½ may be subject to an additional 10% penalty tax and 20% withholding if not made for qualified purposes. Please consult your tax advisor.

Investors should consider the investment objectives, risks, charges, and expenses of a fund carefully before investing. Download a prospectus that contains this and other information about a fund, and read it carefully before investing.

This information is general in nature and not intended to constitute advice. Please consult your tax advisor for more detailed information on tax issues and advice on your specific situation.