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either this is Chris and in this video you learn three things that you'll need to know if you're considering your company's 457 and deferred compensation plan and if you stick around until the end I'll give you a tip about saving for retirement so you've worked your way up the corporate ladder and you're now reaching the level where you're eligible to participate in your company's Supplemental executive retirement plan or SERP let's say as part of your new package you receive a 10% increase in your base pay and a performance-based bonus you might be thinking well I'll defer 5% of my salary and 50% of my bonus that way I'm saving most if not all of my new raise after taxes right wrong here are the three things you need to consider one you need to know what you have the plan we're talking about is different from the 457 plans that are available to teachers and local government employees instead these are deferred compensation plans that are unsecured obligations of the company so you they have to have a substantial risk of forfeiture this means that the funds may be in play if the company enters bankruptcy for example these are plans are not something that you can roll over into an IRA if you quit - you need to know the provisions in the plan for instance are the investment choices any good in the plan what contribution choices are available and how often can make those changes changes to those contributions can the distributions be made over five years ten years or or what after you separate from service and are in service withdrawals available and three most importantly know how this plan fits your personal fight or family financial picture for example if you're not maxing out your 401k you're flexible savings account or other vested accounts you should probably do that before you can see deferred comp another question to ask is what is your income tax bracket now and what do you expect it to be when you retire deferring income today doesn't do you much good if you're in a much higher tax system when you retire your furlough options are typically irrevocable so you want to find out what your cash flow situation is so you don't end up in a cashflow crunch three months after you start deferring through the plan okay so here's the last special tip on saving for retirement find out if you can make after-tax contributions to your 401k plan this is not to be confused with a Roth 401k option you may have an employer 401k plan that offers traditional after-tax and Roth components or even all three even though you can contribute a combined $19,000 for this year into your pre-tax component of your plan you can technically add a total of 56,000 altogether so why is this special well up until a few years ago it was a pain to separate the after-tax contributions you made with earnings that you made on those after-tax contributions after you separated from service now the air IRS has clarified the rules so that your after-tax contributions can easily be rolled over into a Roth and in this industry we call that a jumbo or Mega IRA so I hope this has been a valuable video for you and please let me know if you have any questions my contact information is in the box below the video thank you