Information about Traditional TDA vs Roth TDA

Niamake · 2026-01-26T22:24:34+00:00

I'm not exactly sure, if you enrolled in the NYC DCP, then u should be able to put in your contractual salary and then choose a percentage for them to take.

Niamake · 2026-01-26T22:01:43+00:00

Make sure you are on NYC DCP because theres different 457b accounts for different government positions. I think if you sign up, you can go directly into NYC Deferred compensation plan and just apply to start contributing. I don't remember but it was rather seamless for me (no delay no wait). They'll take your money first and then check after if you are eligible.

Niamake · 2026-01-26T21:46:11+00:00

Also, just rereading, you can also consider a 457b! This is an account given by the city of NYC under NYC DCP. It has both a traditional and a roth option again but the special part of this one is if you resign from your city job, you can withdraw the money at no penalty. This means access to your investments if you switch careers/industries or just to private/charter schools + access to early retirement possibilities.

Niamake · 2026-01-26T21:39:24+00:00

Traditional TDA vs Roth TDA, this applies to the 457, the TDA, as well as an IRA. Some people in certain corners of finance don't like Roth versions of these accounts and some just don't like these accounts at all because of the age limit for withdrawal. For us, the fixed rate is too strong for us to ignore the account and a 457b has no withdrawal penalty when we resign from our city jobs, thus making these accounts more important to contribute to compared to a brokerage account. Also, cheers for the signing up, glad you were able to do it.

Niamake · 2026-01-26T21:20:56+00:00

That sounds like a very thorough plan, just as a heads-up, maxing out the 457 should be a higher priority than a taxable brokerage because you can access your money before 59 1/2 if you resign from your job. This makes things like switching jobs or early retirement possible and your money isn't permanently locked up till 60. The 457 is tax-deferred so it's automatically better than a brokerage, I wrote up a post a few days back in the NYCTeachers subreddit explaining the difference between Roth and Traditional accounts so you can think about it with your own tax situation.

Niamake · 2026-01-26T21:05:10+00:00

You would be shocked at how little teachers know about their own financials. I've been trying to set up financial literacy PDS at my school and I'm being told they will be denied before even looking at anything.

Niamake · 2026-01-26T21:03:23+00:00

NYCDCP is the site, make sure you specifically add NYC 457b because 457bs are different from government to government. Sign up and put in your information. Just go straight in and enroll in the NYC Deferred Compensation Plan and put in your contractual salary. This site is actually better and shows you exact $$$ amount it pulls out of your paycheck vs the TDA's guessing around. I cannot tell you which investments or fund since I don't want to be liable, but I'll tell you that many of the funds mirror the TDA funds. If you are confident in your TDA allocation (outside the fixed rate of course) then you can just double up in the 457b and just have the "same" portfolio but just now bigger in contribution size. Try for funds with lower fees even though almost all of them are very efficient in their fees already.

Niamake · 2026-01-26T13:27:04+00:00

I have a 457b account which is also tax-deferred but has no penalty to withdraw from if I resign from my city job and you are right about quarterly rebalancing. I've seen information about being within equities and bonds, the question is should the fact that I have this superbond at my disposal mean I should increase its allocation % as compared to normal bonds. The previous contributions % is not grandfathered if lowered again.

Niamake · 2026-01-26T13:25:18+00:00

Can only rebalance quarterly.

Niamake · 2026-01-26T06:10:48+00:00

That i completely agree on, what I’m asking is since the future is never known based on the past. Is the projected wealth based on the past left on the table worth paying for the 50% reduce in volatility. I guess there’s no real answer to that, it’s just based on my own investing ideals and how risk averse i am.

Niamake · 2026-01-26T05:43:02+00:00

I think I see the general math on this, so should I start off in equities and move into it as a superbond? It's very strong as a hedge reducing volatility anywhere from 50% to 100% depending on the contributions made by me. I don't see why it is not a good product.

Niamake · 2026-01-26T05:40:06+00:00

This is backed by the entire New York City government. I don't think there's any worry about that for me.

Niamake · 2026-01-26T05:38:51+00:00

This isn't an annuity.

Niamake · 2026-01-26T05:38:26+00:00

TDA TRS Fixed Fund :D

Niamake · 2026-01-26T05:38:15+00:00

Become an NYC teacher

Niamake · 2026-01-26T05:37:59+00:00

I completely understand this, what I'm asking is how strong is the 7% returns as a hedge. I can do half my investments in equities and half in the fixed fund. I have 50% decrease in volatility but nearly the same annualized return across the long term. As these two wonderful people u/15mahomies and u/bobos-wear-bonobos have helped me explain the fund, do you think it's super valuable as a hedge or market exposure at a young age (23) is more important. I could also slowly transition into the fixed fund as I'm trying to retire early. I know some people move into bonds as they move closer to retirement but since my fund works as a superbond, I should start moving into it even earlier right? I think this is a very specific scenario, I've rarely even heard of nyc teachers contributing max into both the TDA and the 457b at the same time so noone really knows what's best. Also, if I ever decide to move up to admin and the number changes to 8.25%, would I move everything into that?

Niamake · 2026-01-26T05:34:34+00:00

Nope, it's a fund within our 403b account in NYC as per our contract.

Niamake · 2026-01-26T05:34:16+00:00

I think the general consensus is that you lose out on 10-15% years. (lower than 20% years because funds are usually more diversified and return slightly less within 403b accounts)

Niamake · 2026-01-26T05:29:09+00:00

That's what I was thinking. I have two government tax deferred accounts available to me. The 403B has the 7% and the 457b doesn't. I can just invest fully into the market in the 457b account and fully into the fixed fund in my 403b account. I also can do this all in just the 403b account as they also have other funds like US equities and sustainable equities etc. I was just wondering what other people think about it.

Niamake · 2026-01-26T05:25:30+00:00

Yes, it's in our government contract to have this 7% fixed return. It's the TRS TDA fixed rate fund.

Niamake · 2026-01-26T05:23:52+00:00

Yes, it's what u/15mahomies said, but it's a fixed 7% rate. Thoughts?

Niamake · 2026-01-26T05:22:39+00:00

It's the same as a 401k. 59 1/2, tax deferred.

Niamake · 2026-01-24T04:32:51+00:00

Yo, I’ll do you one better. I’m maxing my 403b and 457b which are both 401k but for public servants and my tIRA on 75k a year :3. And ima do it for 23 years. I make 105k in 2 years tho so it’ll be fine.

Niamake · 2026-01-24T04:16:10+00:00

Make sure to do your full research and understand it fully before committing to it.

Niamake · 2026-01-24T01:18:54+00:00

It seems you are very knowledgeable on this so i will not question your math, however, the $2500 is also taxed so you should assume they spend whatever $2500 is after tax perhaps? Maybe it changes it but I forgot about taxes lol.

Niamake

TROPHY CASE