Obama's myRA Retirement Account Details

Michael @ MyFinancialRamblings writes:  Details regarding President Obama’s proposed myRA retirement accounts have begun to dribble out. Here is what we know about the program so far:

• It will be targeted at those without access to a workplace retirement plan
• It will be offered via a “familiar” Roth IRA account
• Since it’s a Roth, contributions can be withdrawn at any time
• Initial investments as low as $25 with ongoing contributions of as little as $5
• Contributions will be made via payroll deduction
• Ability to keep same account when changing jobs — yeah, because it’s a Roth
• Interest will be paid at the same rate as the Thrift Savings Plan (TSP) G Fund
• Savers will enjoy “principal protection” so account values can’t decrease
• It will be available to households earning up to the Roth income limit of $191k/year, and presumably subject to the same phaseouts
• The accounts will have “little to no cost” — this isn’t really possible, but presumably there will be no visible fees
• Participants will be able to accrue up to $15k, or participate for 30 years before switching to a private sector Roth IRA
• Accounts will initially be offered via a pilot program to employees whose employers opt-in during 2014

According to the President’s remarks at a stop in Pittsburgh today, the actual investment vehicle within the account will be a savings bond but, as noted above, it will be behave like the TSP Government Securities Index Fund.

So the myRA is just a Roth IRA with low minimums, payroll deduction, and access to a clone of the TSP G Fund. Not exactly revolutionary, and probably not necessary, but it will hopefully make savings opportunities more visible to non-savers.