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Roth 403(b) vs. Roth IRA: What's the difference?

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Thinking through all your retirement planning options can help your money work hard now for your future self. Your employer may offer a plan that you supplement with an account of your own, each with traditional and Roth versions to consider.

Both Roth 403(b)s and Roth IRAs are tax-advantaged accounts that can move you toward your retirement goals. Comparing a Roth 403(b) vs. Roth IRA can help you decide if you want to have one or the other—or even both.

What is a Roth 403(b)

Certain public-sector and tax-exempt employers—such as schools, hospitals, churches, libraries and government agencies—offer traditional and Roth 403(b) retirement plans. Similar to private-sector 401(k)s, you—as the employee—can put a portion of your paycheck into the account. In particular, a Roth 403(b) lets you do this after paying income taxes on the contribution, so you don't pay taxes on your withdrawals in retirement.

Your employer selects the investment company to run the account, but you usually can control your investing options from there. You'll likely be able to choose from annuities and mutual funds that invest in stocks and bonds.

What is a Roth IRA

A Roth IRA is an individual retirement account that you can establish and contribute to on your own. You don't need an employer to set one up for you. Like other Roth accounts, your contributions are made with after-tax dollars. Additionally, you can access the money in retirement tax-free if you meet the required distribution event.

Anyone who earns income from a job or self-employment, and meets IRS income limitations, can contribute to an IRA. You can invest it in assets like stocks, bonds, mutual funds and exchange-traded funds.

Key differences between Roth 403(b) vs. Roth IRA

While they overlap in name, a Roth 403(b) isn't the same as a Roth IRA. While the basic tax treatment is the same for both accounts, they differ by availability, maximum contribution amounts, income limitations, your ability to take loans, and withdrawal rules.

Who is eligible to have Roth IRA or Roth 403(b)?

You can go to any financial institution that offers Roth IRAs and open an account, as long as your income is under a certain limit. But to have a Roth 403(b), you would first have to be a specific kind of employee—one who works at a public-sector or tax-exempt organization—and then meet eligibility requirements for an employer that offers a Roth 403(b) retirement plan.

2023 contribution limits

Roth 403(b)s have much higher contribution limits than Roth IRAs. Plus, with a Roth 403(b), your employer can match your contributions to grow your account even more.

Roth 403(b) contribution limits

With a Roth 403(b), you can:

  • Contribute up to $22,500 of your own wages or salary per year, plus an additional $7,500 per year if you're at least 50 years old.
  • Contribute an additional $3,000 per year if you've been with your employer for at least 15 years (for a lifetime max of $15,000) provided you have not fully funded a Roth 403b in prior years.
  • Accept employer contributions up to a combined limit of $66,000 (or $73,500 if you're at least 50 years old).

Roth IRA contribution limits

With a Roth IRA, you can:

  • Contribute up to $6,500 per year, plus an additional $1,000 per year if you're at least 50 years old.

Income limitations: Roth 403(b) vs. Roth IRA

If you have a Roth 403(b) through your employer, you can contribute to it no matter your income. That isn't the case for Roth IRAs, which have income thresholds. As of 2023, once your income exceeds $138,000 if you're single or $218,000 if you're married, the amount you can contribute starts to decrease. At $153,000 and $228,000 respectively, you're no longer allowed to contribute to a Roth IRA.

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Retirement planning
Curious if you're on track or if you need to be saving more? Check out our guide to retirement savings by age.

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Taking out loans: Roth 403(b) vs. Roth IRA

The IRS doesn't allow loans from Roth IRA accounts for any reason.

You can take loans from Roth 403(b) plans, but it's up to individual employers to decide if their plans will offer loans. If they do, Roth 403(b) plans generally allow you to borrow up to whatever's less: up to 50% of your balance or $50,000. If your account contains $10,000 or less, you may be able to borrow the entire amount.

Making withdrawals: Roth IRA vs. Roth 403(b)

Generally, with any Roth account, you can withdraw your own contributions without facing taxes or penalties at any time. But when it comes to accessing the earnings, both Roth 403(b)s and Roth IRAs are set up with rules to encourage waiting until retirement. For both, you can face taxes and penalties if you withdraw money before age 59½ and if you haven't owned the account for at least five years (although certain exceptions are allowed).1

Roth IRA vs. Roth 403(b) at a glance

Roth IRA

Roth 403(b)


Base contribution limits

$6,500 annually

$22,500 annually

Catch-up contribution(s)

$1,000 annually if age 50 or older

$7,500 annually if age 50 or older and $3,000 annually if with same employer for 15+ years (up to lifetime maximum of $15,000)

How to access

On your own

Through employer


Not allowed


Tax-free withdrawals

After age 59½ and account open for at least 5 years

After age 59½ and account open for at least 5 years

Can you have both a Roth 403(b) & a Roth IRA?

As long as you meet the qualifications, you can have a Roth 403(b) and a Roth IRA at the same time. Since Roth accounts generally offer a tax-efficient savings approach, it could benefit your retirement strategy to contribute to each account type.

Whether it's something you should do, however, depends on your overall financial strategy and circumstances. For instance, if you have too many Roth accounts that are taxed upfront, you may want to mix in traditional accounts to spread out your tax liability over time. Generally, diversifying your investments across accounts that are taxed now, taxed later or never taxed can help you keep a balanced approach. Take time to consider how your accounts can work together to benefit your overall tax and financial situation.

A financial advisor can walk you through options

To make wise choices for your future, survey the options available to you and factor in how each would help you attain your retirement goals. You'll want to map out a financial strategy that lets you afford and enjoy the lifestyle you want for now and later—whether that involves a dream home, sending kids to college, supporting a favorite cause or leaving a lasting legacy. A Thrivent financial advisor can help you determine whether a Roth 403(b), Roth IRA, both or something else entirely is the right fit for you.

Distributions of earnings are tax-free as long as your Roth IRA or Roth 403(b) is at least five years old and one of the following requirements is met: (1) you are at least age 59½; (2) you are disabled; (3) you are purchasing your first home ($10,000 lifetime maximum); or (4) the money is being paid to a beneficiary.

Thrivent and its financial advisors and professionals do not provide legal, accounting or tax advice. Consult your attorney or tax professional.

While diversification can help reduce market risk, it does not eliminate it. Diversification does not assure a profit or protect against loss in a declining market.