myRA - New Government Bond/Retirement savings program

[Higus]

http://www.investopedia.com/terms/m/myra.asp

I heard about this today and I was wondering if anyone could shed some thoughts on the matter. It's basically a new option for retirement savings created by Obama earlier this year specifically designed to help people with low incomes save for their retirement. It acts like a traditional Roth IRA except for a few different factors:

1) It has a much lower minimum contribution rate than normal accounts, basically creating a floor for low income investors to start saving that wasn't there before
2) Based on government savings bonds, so lower risk/lower return than other savings accounts (government guarantees the principal balance)
3) Maximum balance of $15,000, at which point the owner must roll over to a private sector account

Obviously the program is still very early, but I'd like to hear people's thoughts on the program.

 

[MASShole]

I think it's a step in the right direction to get overall savings increased for lower income workers.

 

[Briar]

This sounds like a waste of time. It's almost impossible for a poor person to save enough in their lifetime to retire.

 

[mantronix]

The .gov should do some type of graduated matching program to encourage low income people to invest.

 

[UpaLoompa]

This sounds like a waste of time. It's almost impossible for a poor person to save enough in their lifetime to retire.

Hey, if it helps what's the problem?

I don't know enough of the specifics of the program to say much but I don't object to the premise.

 

[MASShole]

The .gov should do some type of graduated matching program to encourage low income people to invest.

It's already in place: http://www.irs.gov/uac/Get-Credit-for-Your-Retirement-Savings-Contributions

It's not matching, but rather a credit on your tax return which (hopefully) someone would put away if they can.

 

[bobob]

Like Obamacare, it's the government's first step to take over private retirement accounts. Obama should sell it as "If you like you IRA, you can keep it."

 

[AgeofEmpires2**]

How long until that money disappears by giving it to corporations when they need another bailout?

 

[Kevin Rudd]

This sounds like a waste of time. It's almost impossible for a poor person to save enough in their lifetime to retire.

Not the point, it reduces the welfare burden on the government for future generations, they supplement welfare with whatever they have saved for retirement.

 

[TeTe]

If it's a stepping stone to privatizing social security, I'm for it.

 

[Higus]

Like Obamacare, it's the government's first step to take over private retirement accounts. Obama should sell it as "If you like you IRA, you can keep it."

???

That assessment is wrong on so many levels, I don't know where to begin.

 

[mantronix]

It's already in place: http://www.irs.gov/uac/Get-Credit-for-Your-Retirement-Savings-Contributions

It's not matching, but rather a credit on your tax return which (hopefully) someone would put away if they can.

That is pretty weak. Just a $1000 credit for a single person. If you were a full time student during the year you are ineligible. WEAK.
It needs a matching program where the more you put away the higher the percentage of government matching. I don't see too many people utilizing this program otherwise.