The NYS Deferred Compensation Plan, in Plain English
The NYS Deferred Compensation Plan, in Plain English
If you work for New York State or a local public employer that takes part, you may be able to save in the New York State Deferred Compensation Plan. It is a 457(b) plan that sits next to your pension. Here are the basics.
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Who Can Use a Plan Like This
Under state law, counties, cities, towns, villages, school districts, community colleges and other public employers in New York can offer a 457 deferred compensation plan. You save part of your pay through payroll for retirement.
Pre-Tax or Roth
A 457 plan lets you save pre-tax, so the money you put in is not counted in your federal or New York State taxable income that year. Since 2011, New York plans can also offer a Roth 457 account, where you pay tax now instead. For how this affects your taxes, check with your tax preparer.
Want to see how your 457(b) and pension fit together? By video, we will look at your pension, your 457(b) and the rest of your plan, and talk through clear next steps.
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2026 Contribution Limits
For 2026, you can put in up to $24,500. If you are 50 or older, you can generally add $8,000, for a total of $32,500. If you turn 60, 61, 62 or 63 during the year, you can add $11,250 instead, for a total of $35,750. If your Social Security wages in 2025 were over $150,000, your catch-up money has to go in as Roth.
The 457(b) limit is separate from the 401(k) and 403(b) limits. If you also have a 403(b), each plan has its own limit.
Borrowing From Your Account
If you are still working, you may be able to take a loan. The smallest loan is $1,000. The most you can borrow is half your account or $50,000, whichever is less. The interest rate is one point above the prime rate. You can have one loan at a time, and you have up to 5 years to pay it back, or up to 15 years for a loan to buy your main home.
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An Atlas VirtualWealth session takes about 45 minutes and looks at your pension, your 457(b) and the rest of your plan together.
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Call 631-389-2358 or text 631-904-0901 to book.