Do you want to save for retirement? If so, you may want to consider a Lincoln Financial 457(b) Plan. This plan is a great way to save for retirement and offers many benefits, including tax breaks and the ability to invest in a variety of funds.
In this article, we will provide an overview of the Lincoln Financial 457(b) Plan and discuss the reviews, fees, and ratings associated with it. We will also help you decide if this plan is right for you!
Lincoln Financial 457(b) Plan - Reviews, Benefits, Fees & Ratings Table of Contents
What is a Lincoln Financial 457(b) Plan?
A Lincoln Financial 457(b) Plan is a retirement savings plan that allows you to save and invest for your future. It's a great way to build your nest egg and prepare for retirement.
How Does a Lincoln Financial 457(b) Plan Work?
A Lincoln Financial 457(b) Plan works by allowing employees to set aside a portion of their salary on a pre-tax basis. The money that is set aside can then be used for qualified expenses, such as retirement.
What Are The Key Features of a Lincoln Financial 457(b) Plan?
There are a few key features of the Lincoln Financial 457(b) Plan that make it an attractive option for retirement savings. First, the plan offers tax-deferred growth on your investment, which means you won't have to pay taxes on your earnings until you withdraw them.
Additionally, the plan has a "catch-up" provision that allows participants who are 50 or older to contribute extra funds each year, up to a maximum of $24,000. This is a great way to make up for lost time if you haven't been able to save as much as you'd like in the past.
Finally, withdrawals from the plan are penalty-free after age 59, which means you won't have to pay a penalty if you need to access your money before retirement.
What Commissions and Management Fees Does a Lincoln Financial 457(b) Plan Come With?
The fees you'll pay for a Lincoln Financial 457 plan will depend on the provider you choose. Some providers charge annual management fees, while others charge commissions based on the investments you make.
Lincoln Financial has a few different options when it comes to their 457 plans. For example, their Growth Advantage Program charges an annual management fee of 0.65%. However, if you're investing in their LifeStage Funds, you'll pay a commission of up to 0.75% per year.
It's important to compare the fees charged by different providers before you decide on a plan. You don't want to pay more in fees than you need to.
What Are The Advantages of a Lincoln Financial 457(b) Plan?
There are a few advantages of the Lincoln Financial 457 plan that make it worth considering.
One is that you can contribute up to $18,500 per year (or $24,500 if you're over 50), making it a great way to save for retirement.
Another advantage is that the money in your account grows tax-deferred, meaning you won't have to pay taxes on it until you withdraw it in retirement.
Finally, withdrawals from a 457 plan are typically tax-free as long as you're over 59 ˝ years old and have held the account for five years.
What Are The Disadvantages of a Lincoln Financial 457(b) Plan?
There are a few disadvantages to consider with a Lincoln Financial 457 plan.
First, you're limited in how much you can contribute each year. For 2019, the contribution limit is $19,000 for employees under age 50 and $25,000 for those over age 50. That may not be enough to fund your entire retirement, especially if you're close to retirement age.
Another downside is that you're subject to income taxes on the money you withdraw from your account. That means you could end up paying more in taxes than you would with other retirement accounts, like a traditional IRA or 401(k).
Finally, if you leave your job before retiring, you may have to pay a penalty to access the money in your account. That could set you back financially and make it difficult to reach your retirement goals.
What Are Some Alternatives to a Lincoln Financial 457(b) Plan?
When it comes to retirement planning, there are a lot of different options out there. And while a Lincoln Financial 457 plan can be a great option for some people, it might not be right for everyone.
So, what are some alternatives to a Lincoln Financial 457 plan? Well, here are a few ideas:
A 401(k) plan is a retirement savings plan that is sponsored by an employer. Employees can choose to have a certain amount of their paycheck withheld and deposited into the 401(k) plan.
Individual Retirement Account (IRA)
An IRA is a retirement account that is opened and funded by an individual, rather than an employer. There are a few different types of IRAs, but they all offer tax-advantaged savings opportunities.
A Roth IRA is a type of IRA that offers tax-free growth and withdrawals. contributions are made with after-tax dollars, which means that you won't get a tax deduction when you contribute.
A 403(b) plan is a retirement savings plan that is offered to employees of certain tax-exempt organizations, such as schools and hospitals.
A pension plan is a retirement savings plan that is sponsored by an employer. Employees are typically guaranteed a certain level of benefits upon retirement.
These are just a few of the many different options that are available when it comes to retirement planning. Talk with a financial advisor to see if a Lincoln Financial 457 plan is right for you, or if there might be a better option out there.
How Do You Open a Lincoln Financial 457(b) Plan?
You can open a Lincoln Financial 457 plan by visiting the company's website and completing an online application. You will need to provide some personal information, including your Social Security number, date of birth, and contact information.
Once you have submitted your application, a representative from Lincoln Financial will contact you to complete the process.
What is The Minimum Amount Required to Open a Lincoln Financial 457(b) Plan?
The Lincoln Financial 457(b) Plan requires a minimum balance of $25,000 to open an account. This is a pretty standard requirement for most retirement plans.
What Are The Lincoln Financial 457(b) Plan Contribution Limits?
The IRS has set the following contribution limits for 457 plans:
- Elective deferrals (employee contributions): $18,500 per year ($24,500 if age 50 or older)
- Catch-up contributions (for employees aged 50 or over): $6000 per year
- Total annual contributions (employee + employer): $37,000 per year ($54,000 if age 50 or older)
What Are The Eligibility Requirements for a Lincoln Financial 457(b) Plan?
To be eligible for a Lincoln Financial 457(b) Plan, you must:
- Be at least 18 years old
- Have a valid Social Security number
- Be employed by a participating employer
- Not be a resident of the state of New York
If you meet all of the above requirements, you can start contributing to your Lincoln Financial 457(b) Plan as soon as you're enrolled by your employer. There are no age limits or minimum contribution requirements, so you can start saving for retirement on your own terms.
Do You Pay Taxes On a Lincoln Financial 457(b) Plan?
The great thing about a Lincoln Financial 457(b) Plan is that you don't have to pay taxes on the money you put into it.
That's because the money is deducted from your paycheck before taxes are taken out. The only time you'll pay taxes on the money in your account is when you withdraw it. And even then, you may be able to avoid paying taxes if you use the money for qualified expenses.
When Can You Withdraw Money From a Lincoln Financial 457(b) Plan?
You can make withdrawals from your Lincoln Financial 457(b) Plan account for any reason after you turn age 59½. If you leave your job, you can also withdraw money from your account. However, if you do so before turning age 59½, you may have to pay a penalty tax.
How Does a Lincoln Financial 457(b) Plan Compare to a 401K?
In general, a 457 plan is going to have more relaxed rules than a 401K when it comes to withdrawals and contributions. This can be good or bad depending on your personal financial situation.
If you need the flexibility of a 457 plan, then it may be the better option for you. However, if you are disciplined with your finances and can max out a 401K, then you will probably be better off with a 401K.
The other main difference between a 457 plan and a 401K is the investment options. With a 457 plan, you have more control over your investments and can choose from a wider range of options. This can be good or bad depending on your investment strategy.
If you are a hands-on investor, then a 457 plan may be the better option for you. However, if you are not comfortable making your own investment decisions, then a 401K may be the better option.
What Assets Are Available With a Lincoln Financial 457(b) Plan?
As with most 457 plans, the assets available through a Lincoln Financial 457 plan are limited to those offered by the provider. However, Lincoln Financial does offer a wide variety of investment options, including:
- Mutual funds
- Stocks and bonds
- Exchange traded funds (ETFs)
- Money market accounts
Why Do People Use a Lincoln Financial 457(b) Plan?
There are a few reasons why people use a Lincoln Financial 457(b) Plan.
The first reason is that it can be used as a retirement savings account. This is because the funds in the account can be used to pay for qualified expenses when you retire.
Another reason people use a Lincoln Financial 457(b) Plan is because it offers tax-deferred growth. This means that you will not have to pay taxes on the money that you earn in the account until you withdraw it.
The last reason people use a Lincoln Financial 457(b) Plan is because it offers a death benefit. This means that if you die, your beneficiaries will receive the money in the account.
Does a Lincoln Financial 457(b) Plan Accept Rollovers?
The Lincoln Financial Group 457 plan does accept rollovers from other eligible retirement plans, including 401(k)s and 403(b)s. You can roll over funds from an existing account by completing a Rollover Request Form and sending it to your previous plan administrator.
Once the funds are transferred to your Lincoln Financial 457 account, you'll be able to invest them in any of the available investment options. You can also choose to have your rollover funds automatically invested in a target date fund, which will invest your money based on when you plan to retire.
If you're thinking about rolling over funds from another retirement account into a Lincoln Financial 457(b) Plan, make sure to talk to a financial advisor to see if it's the right move for you. They can help you understand the benefits and drawbacks of rolling over your funds, and make sure that you're doing it in the most tax-efficient way possible.
How Long Does It Take to Transfer to a Lincoln Financial 457(b) Plan?
The good news is that transferring your retirement savings to a Lincoln Financial 457(b) Plan is generally a quick and easy process. In most cases, the entire process can be completed within a few weeks.
However, there are a few things that can potentially delay the transfer process. For example, if you have any outstanding loans or distributions from your previous retirement plan, you will need to repay those before the transfer can be processed.
Additionally, if you have any complex investment holdings in your previous retirement plan (such as privately held company stock), it may take a bit longer to properly value those assets and transfer them into your new Lincoln Financial 457(b) Plan.
Overall, though, transferring to a Lincoln Financial 457(b) Plan is usually a fairly straightforward process that can be completed in a matter of weeks.
So if you're looking to consolidate your retirement accounts or take advantage of lower fees and expenses, a Lincoln Financial 457(b) Plan may be the right option for you.
How Do You Put Money Into a Lincoln Financial 457(b) Plan?
There are a few ways that you can put money into your Lincoln Financial 457(b) Plan.
The most common way is through payroll deduction. This means that you elect to have a certain amount of your paycheck withheld each pay period and deposited into your 457 account.
Ye-time or periodic contributions by check, money order, or electronic funds transfer. If you are age 50 or older, you may also be able to make catch-up contributions.
Can You Open a Lincoln Financial 457(b) Plan For a Child?
The quick answer is yes, but there are a few things to consider before doing so.
The first is that the child must have earned income from which the contribution can be deducted. Secondly, once the money is in the account, it cannot be withdrawn until the child reaches retirement age - typically 59 ½.