Roth IRA vs. 403b: Which is Better?

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

What Are They?

Roth IRA: A Roth IRA is an individual retirement account that offers tax-free growth and tax-free withdrawals in retirement. Unlike traditional IRAs, contributions are made with after-tax dollars, and you can withdraw the contributions and earnings tax-free after age 59½, provided the account has been open for at least five years.

403(b): A 403(b) plan is a retirement savings plan available to employees of public schools, certain non-profits, and some religious organizations. Contributions are made with pre-tax dollars, which can lower your taxable income. Taxes are paid on withdrawals in retirement.

Key Differences

FeatureRoth IRA403(b)
Tax BenefitsTax-free growth and withdrawalsTax-deferred growth; taxable withdrawals
ContributionsMade with after-tax dollarsMade with pre-tax dollars
WithdrawalsTax-free after age 59½ and 5 yearsTaxed as ordinary income
Income LimitsYes, varies by tax filing statusNo
Employer MatchNoYes, in some cases
Investment OptionsBroad rangeLimited, depending on plan provider
Contribution Limit$7,000($8,000 if over 50)$23,000
Roth Ira Vs. 403B

Which Is Better For You?

  • If you expect to be in a higher tax bracket in retirement: Consider a Roth IRA for tax-free withdrawals.
  • If you want an employer match: A 403(b) might be better because many employers offer matching contributions.
  • If you have high income: A 403(b) has no income limits for contributions, unlike a Roth IRA.
  • If you want more investment options: A Roth IRA typically offers a wider range of investment choices than a 403(b).


Choosing between a Roth IRA and a 403(b) depends on your current tax situation, expected future tax bracket, and whether you have access to an employer match. Both accounts offer valuable tax benefits for retirement savings. Understanding the differences can help you make the best decision for your financial future.

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Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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