Retirement Plans

myRA logoState retirement initiatives get guidance from U.S. D.O.L.

The U.S. Department of Labor is hoping to provide a way for Millennials to structure retirement plans more easily.

The name of the program is myRA, designed for people who may not have access to a retirement savings plan through their employer. This is the case for nearly 70 million workers in the country. Also, it’s no secret that the pattern seems to indicate that Millennials have trouble saving. myRA is a retirement savings account that can be opened at no charge, and has no minimum account balance or minimum contribution requirements. Individuals or couples can basically choose how much to save, and feel safe doing it. At a press conference in Chicago this Monday, department officials published a notice of proposed rulemaking and an interpretive bulletin meant to work in conjunction with state officials to find ways of expanding savings options for workers who fit the aforementioned criteria. Anyone individual who makes less that $131,000 annually, or any married couple who makes less than $193,000 jointly, are eligible.

myRA aims to encourage saving in a number of ways. First, automatic contributions can be sent from any paycheck directly to any savings or checking account. No tax and penalty are tacked on for withdrawing any of the money that was put in- so previous contributions are accessible at any time. A change in employment is also manageable, because the account isn’t tied to a single employer. Any couple or individual holding multiple jobs will have the ability to contribute from any of them.

Interest can also be earned, and withdrawn in some cases without tax and penalty “under certain conditions” according to the program’s website. All investments are backed by the U.S. Treasury, aimed to help contributors feel secure. The U.S. Department of Labor released the following notice on Monday detailing the program. Financial specialists and state officials were also present during the meeting and have publicly backed the blueprint for the program. For more details, visit the myRA information page, and the complimentary PDFs, via the U.S. Department of Treasury website.

 

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