If you're a teacher, nurse, or non-profit worker, you've probably noticed something about your 403(b): the options are terrible.
Unlike 401(k)s that offer low-cost index funds, most 403(b) plans are stuffed with high-fee annuity products from insurance companies. You're paying 1-2% in annual fees while your school district administrator has no idea what you're even invested in.
A 403(b) to Gold IRA rollover lets you escape that trap. You move your money into an account you control, invested in real assets—not some insurance company's variable annuity product.
Watch Out for Surrender Charges
What is a 403(b) Rollover?
A 403(b)—sometimes called a TSA (Tax-Sheltered Annuity)—is the non-profit world's version of a 401(k). It's offered by public schools, hospitals, churches, and charitable organizations.
A rollover means moving your 403(b) money into an IRA. From a tax perspective, it works exactly like a 401(k) rollover—no taxes or penalties if you do a direct transfer. The money goes from one retirement account to another, tax-free.
The big difference? Once the money is in a Self-Directed IRA, you can invest in things your 403(b) never allowed—including physical gold and silver.
Eligibility Rules
Your ability to roll over depends on your situation:
You Can Roll Over If:
- • You've left that employer (retired, resigned, laid off)
- • You're still employed but age 59½ or older
- • You have funds from a previous employer's 403(b)
You Probably Can't If:
- • You're under 59½ AND still working for that employer
- • Your plan has strict "no in-service withdrawal" rules
Check your plan document or ask HR—rules vary by employer.
Warning: The Annuity Trap
Here's the dirty secret of 403(b) plans: unlike 401(k)s, they're often run by insurance companies selling annuity contracts. And these contracts come with strings attached.
Surrender charges are fees the insurance company charges if you move your money out before a certain period—typically 5-10 years. They can be as high as 7-8% of your balance in the early years.
Typical Surrender Charge Schedule:
- Year 1: 7% penalty
- Year 2: 6% penalty
- Year 3: 5% penalty
- Year 4: 4% penalty
- Year 5: 3% penalty
- Year 6: 2% penalty
- Year 7+: 0% (free to leave)
Before rolling over: Call your 403(b) provider and ask "What are my surrender charges if I move my money?"
The good news? If your surrender period has passed, you can roll over penalty-free. And even if you're still in the surrender period, sometimes the long-term savings from lower fees in a Gold IRA outweigh the one-time surrender charge.
Step-by-Step Process
Rolling over a 403(b) is slightly more complicated than a 401(k) because you're often dealing with an insurance company, not just an HR department. Here's how to do it:
Open a Self-Directed Gold IRA
Choose a Gold IRA company. They'll help you open an account with a custodian who can hold physical metals.
Identify Your 403(b) Vendor
This is usually an insurance company (not your school district). Check your statements for names like VALIC, TIAA, AXA, or Lincoln Financial.
Request a Direct Rollover Form
Call your vendor and ask for their "rollover request form." Specify you want a direct transfer to avoid withholding.
Complete the Paperwork
Fill out the form with your new Gold IRA custodian's information. Your Gold IRA company can help you with this.
Wait for Transfer & Purchase Gold
Funds typically arrive in 2-4 weeks (insurance companies are slower than 401k administrators). Then select your gold.
Tax Benefits
A direct rollover from a 403(b) to a Traditional Gold IRA is completely tax-free. No taxes owed. No penalties. The money simply moves from one tax-advantaged account to another.
Once in your Gold IRA, your investments grow tax-deferred—just like they did in your 403(b). You only pay taxes when you take distributions in retirement.
Roth 403(b) to Roth Gold IRA
Common Mistakes
Ignoring surrender charges
Call your vendor first. A surprise 7% surrender fee on $100,000 is $7,000 out of your pocket.
Taking an indirect rollover
If they mail you a check, 20% is withheld for taxes. Always request a direct transfer to your new IRA.
Contacting HR instead of the vendor
Your school district's HR usually can't help with rollovers. You need to contact the insurance company directly.
Not checking in-service rules
If you're under 59½ and still employed, verify your plan allows rollovers before starting the process.
403(b) Rollover FAQs
Can I roll over my 403(b) without quitting my job?
It depends. If you are over age 59½, most 403(b) plans allow for 'in-service distributions' or rollovers. If you are under 59½, it is more difficult unless you have funds from a previous employer or qualify for a hardship withdrawal.
Will I pay a penalty for moving my 403(b) to Gold?
If you do a 'Direct Rollover' (trustee-to-trustee), there is no IRS penalty or tax. However, be careful if your 403(b) is invested in an annuity contract—some insurance companies charge 'surrender fees' if you move the money out before a certain number of years.
Is a TSA the same as a 403(b)?
Yes, 'Tax-Sheltered Annuity' (TSA) is the old name for a 403(b) plan. The rules for rolling them over to a Gold IRA are identical.
Take Control of Your 403(b)
Don't let high fees eat your retirement. See if you qualify for a penalty-free rollover today.
Written By
Thomas Richardson
Thomas is a former wealth manager with 20+ years of experience. He founded Rich Dad Retirement to expose the flaws of traditional "paper asset" retirement planning and educate Americans on the stability of physical precious metals.