The features of a 403(b) are very similar to those of a 401(k). Employees may make salary deferral contributions that are usually limited by regulatory caps. Individual accounts in a 403(b) can be any of the following types: 1. An annuity contract, which is provided through an insurance company 2. A custodial account, which is invested in mutual funds 3. A retirement income account set up for church employees. The employer may determine the financial institution(s) at which individual employees may maintain their 403(b) accounts, which in turn determines the type of 403(b) accounts that the employees may establish and fund.