The District of Columbia (DC) approval of deferred compensation investment account plan is a program designed to help employees save for retirement and other financial goals. This plan allows employees to defer a portion of their income into an investment account, which can then grow tax-free until retirement. The DC government has set up various types of deferred compensation investment account plans to cater to the different needs and preferences of its employees. These plans offer a range of investment options, including stocks, bonds, mutual funds, and more. Employees can choose the type of plan that aligns with their risk tolerance and financial goals. One of the popular types of deferred compensation investment account plans in DC is the traditional 401(k) plan. This plan allows employees to contribute a portion of their pre-tax income into their investment account, reducing their taxable income and potentially lowering their current tax liability. The contributions and any investment earnings from this plan are taxed upon withdrawal during retirement. Another type of plan is the Roth IRA plan, which allows employees to contribute a portion of their after-tax income into their investment account. While contributions to this plan are not tax-deductible, withdrawals during retirement are tax-free, including any investment earnings. This plan is particularly beneficial for employees who anticipate being in a higher tax bracket during retirement. The District of Columbia approval of deferred compensation investment account plan also includes a 457(b) plan, available exclusively to government employees. This plan allows employees to defer a portion of their income into their investment account, reducing their taxable income. Similar to a traditional 401(k) plan, contributions and investment earnings from this plan are taxed at retirement. Overall, the District of Columbia approval of deferred compensation investment account plan is a valuable benefit for DC government employees, offering them the opportunity to save for their future and enjoy potential tax advantages. Whether employees opt for a traditional 401(k), Roth IRA, or a 457(b) plan, they can choose the plan that suits their financial needs and retirement objectives.