A Guidestone 403(b) Adoption Agreement: What You Need to Know

When it comes to planning your retirement, one of the most important decisions you will make is choosing the right retirement savings plan. This is where a 403(b) plan comes in handy. It is a tax-advantaged retirement savings plan that is specifically designed for employees of certain non-profit organizations, such as hospitals, schools, and charitable organizations.

One of the most popular providers of 403(b) plans is Guidestone. If you are considering opening a Guidestone 403(b) plan, you will need to sign an adoption agreement. Here is everything you need to know about the Guidestone 403(b) adoption agreement.

What is an Adoption Agreement?

An adoption agreement is a legal agreement between you and Guidestone. It establishes the terms and conditions of your 403(b) plan and outlines the rights and responsibilities of both parties. Essentially, it is the document that governs your plan.

The adoption agreement covers a range of topics, including eligibility requirements, contribution limits, investment options, and withdrawal rules. It is important to carefully review and understand all of the provisions of the agreement before you sign it.

Eligibility Requirements

To participate in a Guidestone 403(b) plan, you must meet certain eligibility requirements. For example, you must be an employee of an eligible employer and meet certain minimum age and service requirements. Your employer may also have additional eligibility requirements that you must satisfy.

Contribution Limits

One of the main advantages of a 403(b) plan is its generous contribution limits. In 2021, you can contribute up to $19,500 to your plan on a pre-tax basis. If you are age 50 or older, you can make an additional catch-up contribution of up to $6,500.

Your employer may also make contributions to your plan on your behalf. These contributions are subject to certain limits and restrictions.

Investment Options

Guidestone offers a range of investment options for your 403(b) plan. These include mutual funds, fixed and variable annuities, and other investment vehicles. You can select the investment options that best meet your individual investment goals and risk tolerance.

Withdrawal Rules

You can withdraw funds from your Guidestone 403(b) plan under certain circumstances. These include retirement, disability, death, and financial hardship. Withdrawals may be subject to taxes and penalties, so it is important to understand the rules before taking money out of your plan.

Final Thoughts

A Guidestone 403(b) adoption agreement is an important document that outlines the terms and conditions of your retirement savings plan. It is important to carefully review and understand all of the provisions of the agreement before you sign it. With careful planning and a sound investment strategy, your 403(b) plan can help you achieve your retirement goals.