The U.S. Department of the Treasury announced that it will begin to wind down the myRA program after a thorough review by Treasury found it not to be cost effective.
The myRA program was launched in 2015 as a way for individuals to set up automatic direct deposit contributions to myRA through their employer, fund a myRA account directly by setting up recurring or one-time contributions from a checking or savings account, or at tax time, direct all or a portion of a federal tax refund to myRA. The program required an initial contribution of at least $25 and automatic ongoing contributions of $5 or more every payday.
The Treasury Department’s review was undertaken as part of the Trump Administration’s effort to assess existing programs and promote a more effective government. The department said demand for and investment in the myRA program has been extremely low. American taxpayers have paid nearly $70 million to manage the program since 2014.
“The myRA program was created to help low to middle income earners start saving for retirement,’ said Jovita Carranza, U.S. Treasurer, in the announcement. “Unfortunately, there has been very little demand for the program, and the cost to taxpayers cannot be justified by the assets in the program. Fortunately, ample private-sector solutions exist, which resulted in less appeal for myRA. We will be phasing out the myRA program over the coming months. We will be communicating frequently with participants to help facilitate a smooth transition to other investment opportunities.”
A myRA Program Update on the Treasury Department’s website says existing accounts will remain open and participants can continue to manage their accounts until further notice. During this time, participants will be able to continue making deposits and their accounts will continue to earn interest. The department will notify participants over the coming weeks of next steps and relevant deadlines regarding the transfer or closure of their accounts.