MyRA Accounts

[bjl584]

http://www.cnbc.com/id/101373440

I personally don't see how this is going to benefit anyone. People could open up a Roth IRA and invest in treasuries or a MM account just the same. But, saving is a mindset. Not a government program.

[bigdaddybus]

Sounds like they are making it easier for the working poor to save for retirement. (reduced minimum, not tied to employer)

I dont think it will due much, heck I work with people making 75K+ that dont contribute to our matching 401K at work "because they cant afford it"

[disneysteve]

Sounds like they are making it easier for the working poor to save for retirement. (reduced minimum, not tied to employer)

I dont think it will due much, heck I work with people making 75K+ that dont contribute to our matching 401K at work "because they cant afford it"

It has some advantages - low minimum, offered through employer but not tied to employer.
It also has some serious problems - virtually no return on investment and able to withdraw money at any time for any reason.

And the main reason why most low income people don't save for retirement is because they are low income people. They don't feel they can manage to give up $25 from each paycheck.

[kork13]

I wondered how long it would take for myRA's to show up here on the forum... Just over a day, apparently! haha

I like the IDEA, but wish it would go further. I know this is an issue close to heart for DS & many others (40%-50% of working Americans) without access to an employer-sponsored retirement plan... This is great as a means of encouraging people just starting out (thanks to the VERY low minimum), but as for actually helping to prepare Americans for retirement, the problem of super-low IRA minimums (compared to 401k-type plans) is crippling. Raise the IRA limits to be at least somewhat equitable for those without employer plans (even if the low limits still apply to those with employer plans)...

My other concerns with what this is looking like are:
- It's waaaay over-conservative -- sounds like they want to peg it to the TSP's G-Fund, which although it's excellent for what it is (guaranteed, ultra-short duration bonds with the returns of mid-duration bonds), this myRA idea appears to be little more than a federal savings account that happens to be able to roll into an IRA. Savings vehicles restricted to only holding assets zero risk are NOT appropriate in most cases for young people just starting out, because the returns will be miniscule.
- The $15k balance limit (vs. an annual contribution limit) is a joke. Instead of giving savers an actual option beyond IRAs, the myRA idea basically just gives them a holding cell for money until they have enough in startup funds to transfer into a regular old IRA that they have always had access to.