Investment Company and Variable Contracts Products Representative (Series 6)Practice Exam

457 plans are specifically designed for certain types of government employees, particularly those employed by state and local governments. These plans allow employees to defer a portion of their earnings into a retirement savings account, often with significant tax advantages. In the context of 457 plans, its applicability directly relates to state and local government entities. These plans facilitate financial security for employees, such as those working in public service roles or local government positions, enabling them to save for retirement effectively. On the other hand, while federal employees have access to similar arrangements, such as the Thrift Savings Plan (TSP), it is not classified as a 457 plan. Non-profit organizations generally utilize different retirement plans, like 403(b) plans, which cater to tax-exempt organizations. Therefore, the correct answer reflects that 457 plans are primarily utilized by local government employers.