403(b) Plan
Definition A 403(b) plan, also known as a tax-sheltered annuity (TSA) plan, is a retirement plan for certain employees of public schools, employees of certain tax-exempt organizations and certain ministers. It allows employees to make tax-deferred contributions from their salary to invest in retirement savings. Importance of 403(b) Plans 403(b) plans provide a valuable benefit for employees in the nonprofit sector and education, offering a way to grow their retirement savings on a tax-deferred basis, similar to the benefits of a 401(k) in the private sector.