Which groups are eligible to participate in a 403(b) plan?

• A. Public education organizations and some non-profit employers (501(c)(3))
• B. For-profit corporations only
• C. Self-employed individuals only
• D. Banks and credit unions

Answer: (A)

403(b) plans are retirement savings options for employees of certain employers. They’re available to workers at public education organizations—such as public schools and universities—and to employees of eligible nonprofit organizations that have 501(c)(3) status. That means many public education staff and nonprofit employees can participate. In contrast, for-profit corporations don’t offer 403(b) plans, self-employed individuals aren’t typically eligible unless they’re employed by an eligible nonprofit, and banks or credit unions generally don’t qualify unless they operate as a qualifying nonprofit employer. So, the groups described as public education organizations and some nonprofit employers are the ones who can participate.