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10 Smart Reasons to Save for Retirement with a Legend §457(b)

No premature distribution penalty – Once you separate from service, §457 account distributions are not subject to the 10% premature penalty that applies to §403(b) plans and IRAs prior to age 59½.
Tax Advantages -
Pre-tax Savings – Traditional §457(b)
By deferring compensation into a traditional §457 account, you realize immediate tax savings on your contributions. Before taxes are taken out, you paycheck is reduced by the amount you decide to invest. Therefore your total taxable income is less.
Tax-deferred Growth Potential – Traditional §457(b)
Taxes on any investment earnings in a traditional §457 account are deferred as well. This way, you don’t pay taxes on anything your deferred compensation earns until it is distributed. While withdrawals from traditional §457 accounts are taxed as ordinary income, the impact may be minimized as many investors my find themselves in a lower tax bracket at retirement.1
Tax-free Growth Potential – Roth §457(b)2
While Roth §457(b) contributions are made with after-tax dollars, both contributions and earnings may grow tax-free.
Tax-free Retirement Income – Roth §457(b)2
Qualified Roth §457(b) account distributions are tax-free.
The power of time – By making regular contributions to your employer’s §457(b) plan, you have the potential to develop a sizeable nest egg over the long term.
Automatic payroll deductions – The amount you decide to defer each pay period will automatically be withheld from your paycheck and deposited into your retirement account.
Built-in dollar cost averaging3 – Since the amount you contribute is deducted from your paycheck at regular intervals, dollar cost averaging is built in to your investment plan. With dollar cost averaging, you buy more shares when prices are low and fewer when prices are high. Over time, the average amount paid (average cost) for each share may be less than the average price per share.
A Variety of Investment Options – With a Legend §457(b), you may choose from a wide variety of investment options, including a selection of nationally recognized mutual funds, and you can change your investment mix as your needs change.
Access to Your Savings – Some §457(b) plans offer a loan provision4 that enables participants to borrow from their account. Under Legend’s loan program, principal and interest are paid back into your account.
Catch-up Contributions5 – The Over Age 50 Catch-up provision allows employees age 50+ to boost their retirement savings by making additional §457(b) account contributions beyond the maximum limits set each year. Furthermore, the Retirement Catch-up provision provides for additional contributions for §457(b) plan participants in the three years immediately preceding the attainment of “normal” retirement age. This deferral allows for up to twice the normal maximum contribution limit.
Access to Professional Investment Management Services – Through your Legend Group financial advisor, you have the opportunity to participate in Legend Advisory Corporation’s Strategic Asset Management® (SAM®) and SAM® Select services. These programs were designed to make professional asset allocation techniques, investment selection and ongoing investment management available to individual investors. SAM® and SAM® Select offer a range of diversified6 portfolio options that are managed by a team of experienced investment professionals.
Guidance from a professional Financial Advisor – Your Legend Advisor is available to help you as you work toward building your financial future. He or she can answer your questions, work with you to develop a viable investment strategy and assist you in selecting the investment options that may best reflect your needs. Your Advisor can also provide information about your state retirement plan, and offer ongoing guidance as you work to reach your investment goals.
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1Distributions from a traditional retirement account are subject to ordinary income taxes in the year distributed. Distributions prior to age 59½ may incur an additional 10% penalty.

2In order for a Roth §457(b) to be distributed tax-free, the account must be open for a minimum of five years and the individual accountholder must have attained age 59½. Otherwise, the distribution would be treated as part return of principal and part taxable income.

3Dollar cost averaging does not assure a profit and does not protect against a loss in declining markets. Investors should consider their ability to purchase shares continuously during periods of falling share prices. The principal value of an investment will fluctuate so that an investor’s shares, when sold, may be worth more or less than their original cost.

4Defaulting on a loan from a retirement plan constitutes a distribution from that plan. Distributions from a §457(b) retirement plan are subject to ordinary federal income tax. Loans may affect cash values and death benefits.

5The Over Age 50 Catch-up and the Retirement Catch-up cannot be used in conjunction with one another. Certain other restrictions may also apply to the Retirement Catch-up. Ask your Legend Advisor to help you determine how much you can defer.

6Diversification does not assure a profit or protect against market loss.

Legend Equities Corporation and its affiliates do not provide tax information or advice.

Before investing in a mutual fund, consider its investment objectives, risks, charges and expenses carefully. The prospectus, which contains this and other information about the mutual fund, can be obtained by contacting Legend Equities Corporation. Please read the prospectus carefully before you invest or send money.