The earnings and returns on funds invested in a regular 403(b) retirement plan are tax-deferred until a withdrawal is made. You are still subject to the 10% penalty if you begin withdrawing from your retirement before reaching the age of 59 and a 1/2.

403(b) plans for teachers tend to have shorter vesting schedules than 401(k) plans. This means the money in the account is yours sooner.

403(b) plans for teachers have the same maximum contribution limit as a 401(k), but there is an exception to that—if you have served 15 or more years in your current position, you can contribute an additional $3,000 annually.

Teachers with 403(b) plans are potentially eligible for matching contributions made by their employer. This option may not be available for every employee, and the amount can vary from employer to employer.