Description of the Maryland Supplemental Retirement Plans

The State of Maryland provides the Maryland Teachers & State Employees Supplemental Retirement Plans as an employee benefit. These defined contribution plans are available for voluntary participation. Three plans are offered: the 457(b)Deferred Compensation Plan, the 403(b) Tax Deferred Annuity Plan, and the 401(k) Savings and Investment Plan. In addition, most employees are enrolled into the 401(a) Match Plan. The plans are governed by the State Personnel & Pensions Article of the Maryland Code and are overseen by a nine-member Board of Trustees appointed by the Governor. The Board has contracted with Nationwide Retirement Solutions to administer the plans according to the Board's instructions.

All contributions are made through payroll deductions. Except for contributions into the 457(b)Roth Plan and 401(k) Roth Plan, these contributions are made before federal and state income taxes are assessed. The number in the name of each plan (i.e., 457(b), 403(b), and 401(k)) refers to the different sections of the internal revenue code that give the conditions for deferring taxes on retirement savings.

While there are some differences in each plan (Three-Plan Comparison Chart), the basics of each plan are the same for the “pre-tax” plans (i.e., all of the plans other than the 457(b)and 401(k) Roth Plans): part of your salary goes into an investment option without deducting any taxes, and taxes are deferred on your investment as it hopefully grows throughout your working years until it's paid out to you when you retire, and you elect to take a distribution.

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