UC 403(b) and 457(b) Supplemental Savings for California Employees

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Last updated: August 15, 2026 · By Gold California Editorial

This page is for UC employees, retirees, and surviving spouses who want a clear, source-grounded explainer of the University of California supplemental savings accounts. Every figure traces to an IRS or UCnet source, cited inline, and reflects the 2026 limits published in IRS Release IR-2025-111 on November 13, 2025.

What are the UC 403(b) and 457(b) supplemental plans?

The UC Retirement Savings Program includes three voluntary accounts: the UC 403(b) Plan, the UC 457(b) Plan, and the UC Defined Contribution Plan (DC Plan). The 403(b) and 457(b) are the two supplemental savings accounts a UC employee can fund through payroll deferrals on top of UCRP or the Retirement Choice DC account (source: UCnet, Supplemental Retirement Savings).

The 403(b) is authorized under Internal Revenue Code Section 403(b). It is a tax-favored payroll savings plan available only to employees of public schools, colleges, universities, and certain non-profits (source: IRS, 403(b) Contribution Limits).

The 457(b) is a governmental deferred-compensation plan authorized under IRC Section 457(b), offered by state and local government employers such as the University of California (source: IRS, IRC 457(b) Deferred Compensation Plans).

Both plans are administered by the University of California, with recordkeeping and participant services provided by Fidelity Retirement Services. Employees manage contributions and investments through the NetBenefits online portal at netbenefits.com or the Fidelity phone line at 866-682-7787.

Who is eligible to enroll at UC?

Nearly every UC employee is eligible to enroll in either plan, including part-time and per-diem workers. The 403(b) and 457(b) are independent of UCRP or Savings Choice enrollment, so a worker in Pension Choice, Savings Choice, or a limited-service position can still open a 403(b), a 457(b), or both.

UC retirees, disabled members, and certain surviving spouses who continue to receive UC-source income may keep balances in the plans and, in some cases, continue contributing under limited rules. Rollover-in contributions from prior employer plans are permitted under the same rules that apply to any qualified plan.

Enrollment is voluntary and does not affect a UC employee's UCRP benefit, Pension Choice service credit, or Savings Choice employer contribution. Neither the 403(b) nor the 457(b) at UC currently offers an employer matching contribution.

2026 contribution limits and how the two plans stack

The IRS sets a separate elective deferral limit for the 403(b) and the 457(b), which is the key feature that lets UC employees defer far more than a private-sector 401(k) alone would allow. For 2026, the base elective deferral limit is $24,500 for each plan.

The 403(b) limit under IRC 402(g) and the governmental 457(b) limit under IRC 457(e)(15) are independent. A UC employee can defer up to the full $24,500 into the 403(b) and another $24,500 into the 457(b) in the same year.

UCnet states this plainly: "In 2026, you can save up to $24,500 in any combination of pretax or Roth contributions to the 403(b) Plan, plus another $24,500 in pretax or Roth contributions to the 457(b) Plan. That's a total of $49,000."

The 403(b) also has an annual additions limit of $72,000 in 2026 under IRC 415(c). That cap covers the combined employee deferrals, employer contributions, and after-tax contributions to any one 403(b) plan in a single calendar year (source: IRS, 403(b) Contribution Limits).

Sources: IRS Release IR-2025-111 (November 13, 2025); IRS, 403(b) Contribution Limits; IRS, IRC 457(b) Deferred Compensation Plans; IRS Topic 558; UCnet, Supplemental Retirement Savings. Checked August 2026.

Pretax versus Roth contributions inside the 403(b) and 457(b)

UC offers both pretax and Roth contribution types inside each supplemental plan. Both types share the same $24,500 elective deferral bucket, so the split is a mix decision, not an add-on.

A pretax contribution is deducted from taxable wages the year it is made. Investment growth is tax-deferred. Both the contributions and the earnings are taxed as ordinary income when withdrawn.

A Roth contribution is made from after-tax wages, so it does not reduce current-year taxable income. Qualified distributions of Roth contributions and Roth earnings come out federal-income-tax free once the account has been open at least five years and the participant is at least 59 1/2, disabled, or deceased (source: IRS, Roth Comparison Chart).

The choice between pretax and Roth is a personal tax-planning decision that depends on current and expected future tax brackets, state of residence at retirement, and estate goals. Consult your tax advisor for your specific situation.

Age-50 catch-up, super catch-up, and the 457(b) Last 3-Year Catch-Up

Beyond the $24,500 base limit, three catch-up rules can raise the ceiling for older UC workers. Each rule has its own eligibility test, and only one 457(b) catch-up can apply in the same year.

The age-50 catch-up allows a worker who is 50 or older by December 31 to defer an extra $8,000 per plan in 2026, on top of the $24,500 base limit. That raises the maximum in each plan to $32,500 (source: IRS Release IR-2025-111).

SECURE 2.0 introduced a higher catch-up amount for participants ages 60, 61, 62, and 63. In 2026 the IRS confirms this super catch-up is $11,250 in each plan that offers it, in place of the $8,000 (source: IRS Release IR-2025-111). At age 64 the catch-up drops back to the age-50 figure.

The 457(b) has a plan-specific "Last 3-Year Catch-Up" that lets some participants contribute the lesser of double the annual limit or the base limit plus unused prior-years' room, during the three calendar years before the plan's normal retirement age. This special 457(b) catch-up and the age-50 catch-up cannot be used together in the same year (source: IRS, 457(b) Contribution Limits).

How the plans coordinate with UCRP, Pension Choice, and Savings Choice

The UC 403(b) and 457(b) are structurally independent of a UC employee's primary retirement plan election. A worker keeps them whether the primary plan is UCRP for grandfathered employees, Pension Choice for most employees hired since July 1, 2016, or Savings Choice for those who elected the all-defined-contribution path.

UCnet describes the two Choice paths as follows: "For most employees hired July 1, 2016, and after, most new employees have two options: Pension Choice or Savings Choice." Pension Choice pairs a defined-benefit UCRP pension with a smaller defined-contribution Supplemental Benefit account. Savings Choice is a stand-alone 401(k)-style defined-contribution plan (source: UCnet, UC Retirement Choice Program).

Whichever primary path applies, the 403(b) and 457(b) sit on top as voluntary savings buckets. The IRS 402(g) elective deferral limit does count contributions to the UC 403(b) together with any 401(k) or 403(b) at other employers in the same year, but not the UC 457(b).

A common planning point: for a UC employee who also has a private-sector 401(k) side gig, the $24,500 402(g) limit is shared across the 401(k) and the 403(b). The 457(b) limit sits outside that shared bucket, which is why UC's dual-plan setup is a rare tax-favored savings capacity.

Investments, Fidelity Retirement Services, and BrokerageLink

UC selects a core investment menu offered inside both the 403(b) and the 457(b). The menu typically includes UC-branded target-date funds, index funds, actively managed funds, and a stable-value or money-market option, all held on the Fidelity NetBenefits platform (source: UCnet, Supplemental Retirement Savings).

UC also offers Fidelity BrokerageLink, a self-directed brokerage window inside each plan that allows participants to invest a portion of the account in a broader universe of Fidelity-approved mutual funds and, subject to plan rules, other securities. BrokerageLink has its own participation form and fees, published on NetBenefits.

Physical precious metals are not permitted inside a 403(b) or 457(b) plan account. The Internal Revenue Code allows physical bullion only inside an IRA that meets the strict custodian and depository rules of IRC 408 (source: 26 U.S.C. Section 408).

Fund fees inside the UC core menu are institutional class, generally in the single-digit basis-point range for index options. Fee levels change over time and are disclosed in the UC fund fact sheets and the plan annual notice.

How to enroll in the UC 403(b) or 457(b) Plan

Enrollment is handled through NetBenefits at netbenefits.com or by phone with Fidelity Retirement Services at 866-682-7787. UC does not require in-person paperwork for enrollment or contribution changes in most cases.

1. Log in to NetBenefits or create a Fidelity NetBenefits account. UC employees typically sign in with an existing Fidelity username or set one up on first visit at netbenefits.com. Have your UC employee ID ready.
2. Choose the plan or plans to enroll in. Options include the UC 403(b) Plan, the UC 457(b) Plan, or both. Enrolling in one does not enroll you in the other.
3. Set a contribution rate for each plan. You elect either a percentage of eligible pay or a flat dollar amount per pay period, plus a pretax or Roth split within the elected total.
4. Pick your investment allocation. Choose from the UC core menu or elect BrokerageLink. Target-date funds serve as a default option; you can change the allocation at any time.
5. Name your beneficiaries. Set primary and contingent beneficiaries on each plan separately. Beneficiary designations override a will for retirement plan assets.
6. Confirm and monitor. Verify the first payroll deferral posts as expected in the next pay cycle. Review your account at least annually and after any change in income, marriage, birth, or job status.

Contribution rates can be changed at any time through NetBenefits, effective the next available payroll. There is no waiting period to start, stop, or modify contributions in either plan.

What happens at separation from UC

When a UC employee separates from service, four options are typically available for the 403(b) and 457(b) balance. The choices are: leave it in the UC plan, roll it into a new employer's eligible plan, roll it to a traditional or Roth IRA, or take a cash distribution. Each has distinct tax consequences.

Leaving the balance in the UC plan preserves the institutional-class investment menu, keeps Fidelity as the recordkeeper, and delays any current-year tax event. UCnet publishes the minimum-balance rules under which a former employee may keep the account in place. Small balances may be involuntarily cashed out under IRS rules.

Rolling to a new employer's 401(k), 403(b), or governmental 457(b) is permitted for like-to-like plans and, within limits, across plan types. A direct rollover moves the funds custodian-to-custodian with no federal withholding.

Rolling to a traditional IRA opens a broader investment universe, including a self-directed IRA that can hold IRS-approved physical bullion. Readers researching that path can review our explainer on how a 403(b) rolls into a gold IRA in California. The 457(b) has a unique early-distribution rule discussed below that changes at the IRA boundary.

A cash distribution triggers federal income tax on the taxable portion. It also carries mandatory 20% federal withholding under IRC 3405(c) on eligible rollover distributions paid to you in hand. For the 403(b), the federal 10% additional tax under IRC 72(t) then applies if you are under 59 1/2 and no exception is available (source: IRS, Rollovers of retirement plan and IRA distributions).

One point unique to the 457(b): governmental 457(b) distributions are not subject to the federal 10% early-distribution tax while inside the plan, per IRS Topic 558. Rolling the 457(b) money into an IRA transfers those dollars into the IRA rulebook, and the federal 10% then applies to any pre-59 1/2 IRA distribution unless an IRC 72(t) exception applies (source: IRS Topic 558).

California tax treatment of contributions and distributions

California generally conforms to federal rules on 403(b) and 457(b) contributions. Pretax deferrals reduce California wages the same year they reduce federal wages, and Roth deferrals do not. Investment growth inside either account is not currently taxable to California.

At distribution, ordinary California income tax applies to pretax amounts and to non-qualified Roth withdrawals. California has nine income brackets topping at 12.3%, plus the 1% Mental Health Services Tax on taxable income over $1,000,000, for a top ordinary rate of 13.3% (source: California FTB, Early distributions).

California also imposes an additional 2.5% state tax on early distributions that are subject to the federal 10% additional tax. It is reported on California Form FTB 3805P, attached to the state return for the year of distribution (source: California FTB, 2024 Form 3805P Instructions). California does not conform to every federal IRC 72(t) exception, so an early distribution that escapes the federal 10% can still owe the state 2.5%.

When the 403(b) or 457(b) may not be your best next dollar

Deferring the maximum is not the right move for every UC employee. Naming when it is not helps you spot the situations where a different account or a different sequence would serve you better.

• You still carry high-interest consumer debt. Paying off a card that charges 20%-plus generally beats any expected tax-favored return, even before considering market risk.
• You lack an emergency fund. The 403(b) has restricted access before 59 1/2, and the 457(b) also has plan-defined access rules. A liquid taxable emergency fund usually comes first.
• You are near the annual additions cap. If large employer or after-tax contributions to a 403(b) push you toward the $72,000 IRC 415(c) limit, extra elective deferrals may bump against that ceiling.
• You expect a much lower future tax bracket only marginally. Roth-versus-pretax math becomes marginal when brackets are close, and the choice can be swamped by state-of-residence changes at retirement.
• You need the money before age 59 1/2 and prefer 403(b) over 457(b). The 403(b) does not carry the 457(b) exemption from the federal 10% additional tax on early distributions.
• You are considering a physical-metals IRA on top of your workplace plan. UC plans do not hold bullion; that decision belongs in a separate self-directed IRA and warrants its own research on custodian, depository, and fee terms.

UC 403(b) and 457(b) questions, answered

Can a UC employee contribute the full $24,500 to both the 403(b) and the 457(b) in 2026?

Yes. Under federal rules, the IRC 402(g) limit that governs the 403(b) and the IRC 457(e)(15) limit that governs the governmental 457(b) are separate. UCnet confirms a UC employee may defer up to $24,500 into each plan in 2026, for a combined $49,000 in elective deferrals across the two plans.

Does UC contribute or match anything to the 403(b) or 457(b) Plan?

No. The UC 403(b) and 457(b) plans are voluntary employee-funded supplemental savings accounts. UC does not currently make matching or non-elective contributions to either supplemental plan. Employer contributions flow through UCRP, the Pension Choice Supplemental Benefit, or the Savings Choice account instead, depending on your primary plan election.

Are Roth contributions available inside the UC 403(b) and 457(b)?

Yes. UCnet lists pretax and Roth as contribution types for both the 403(b) Plan and the 457(b) Plan. Roth contributions come out of after-tax pay and grow tax free. Qualified distributions of Roth contributions and earnings are federal-income-tax free once the account has been open at least five years and the participant reaches at least 59 1/2, becomes disabled, or dies.

What is the 2026 catch-up amount for UC employees age 50 or older?

In 2026 the IRS age-50 catch-up is $8,000 per plan, raising the base $24,500 elective deferral limit to $32,500 in each of the UC 403(b) and UC 457(b). SECURE 2.0 raises that catch-up to $11,250 in each plan for participants who are ages 60, 61, 62, or 63 during 2026, per IRS Release IR-2025-111.

Can I roll a prior employer's 401(k), 403(b), or IRA into the UC 403(b) or 457(b)?

Generally yes, if the receiving UC plan accepts the rollover type and the source plan reports it correctly. UCnet publishes the accepted rollover-in types on NetBenefits and in the summary plan description. Rollover-in contributions do not count against the annual $24,500 elective deferral limit.

Does the 457(b) lose its federal 10% early-distribution exemption if I roll it to an IRA?

Yes. IRS Topic 558 confirms that governmental 457(b) distributions are not subject to the federal 10% additional tax while inside the plan. Once the money is rolled into a traditional IRA, IRA rules apply, and pre-59 1/2 IRA distributions generally face the federal 10% additional tax and California's 2.5% unless an IRC 72(t) exception applies.

Can I hold physical gold or silver inside my UC 403(b) or 457(b)?

No. Neither the UC 403(b) nor the UC 457(b) permits direct ownership of physical bullion. The Internal Revenue Code allows physical bullion only inside an IRA that meets the custodian and depository rules of IRC 408. A separate self-directed IRA would be required after a qualifying distribution or rollover.

Who do I call at Fidelity for UC 403(b) and 457(b) questions?

Fidelity Retirement Services is the UC recordkeeper. Participants can call 866-682-7787, log in at netbenefits.com, or reach out to a UC-dedicated Workplace Financial Consultant listed on the UCnet Supplemental Retirement Savings page. UC-specific plan documents and fund fact sheets are posted on the same UCnet page.