The Treasury Department recently announced that it will begin to wind down the myRA program after a review by the government found it not to be cost-effective.
MyRAs were launched in 2014 as a savings plan offered by Treasury intended to encourage retirement savings among low-income individuals lacking employer-sponsored retirement plans. MyRAs operated essentially the same as Roth IRAs, allowing after-tax contributions to the account. However, the sole investment option was a Treasury security that earned the same interest rate as the government bond fund available to federal employees. Also, participants paid no start-up fees or account maintenance fees.
According to Treasury, demand for and investment in the myRA program has been low, while the cost to the federal government to manage the program since 2014 was high. Treasury announced that it will phase out the myRA program over the coming months, and it will communicate frequently with participants to help facilitate a smooth transition to other investment opportunities. Participants in the myRA program are being notified of the upcoming changes, including information on moving their myRA savings to another Roth IRA. Treasury encourages myRA participants to visit www.myRA.gov for additional information or to call myRA customer support with any questions.
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