(b)lines Ask the Experts – Which 403(b) Plan Is the Oldest?

“Is there a 403(b) plan that is generally recognized as the oldest 403(b) plan in the country? Our plan dates from the early 1960s, and I was wondering how it stacks up in terms of longevity.” 

Michael A. Webb, vice president, Cammack Retirement Group, answers:

Thanks for posing this unusual question, since it allows the Experts to address a common misconception that 401(k) plans have been in existence longer that 403(b) plans. Whereas the oldest 401(k) plans date back to approximately 1982, 403(b) was added to the Code several decades earlier, in 1958. 

Though the Code specifically addressed only 501(c)(3) organizations as eligible plan sponsors, it was clarified in 1961 that public education institutions, such as school districts and public universities, could sponsor 403(b) plans as well.

Thus, if you are a public university, your plan may be among the oldest sponsored by such an institution. For private universities, it was possible to establish a 403(b) plans a few years earlier. In the Expert’s experience, however, the oldest 403(b) plans date back to the 1960s.

However, in another interesting historical aspect of 403(b) plan regulations, arguably the oldest 403(b) plans were ones that were not formally recognized under the Code until 1982. In that year, Code Section 403(b)(9) permitted churches to establish Retirement Income Accounts. However, churches had been maintaining such plans for many years prior to their formal recognition under the Code. Amazingly, some of these plans date back to the early 1900’s!

Thank you for your question, and, as a reminder to our readers, keep those question coming, as no inquiry is too “trivial!”