‘myRA’ Offers a New Way to Save for Retirement

The dream of a secure retirement is too hard to grasp for many Americans. According to the Federal Reserve Board, 31 percent of non-retired Americans report having no retirement savings or pension. One key reason is a lack of a retirement plan at work – a trend that is particularly common and alarming among Latinos, as only 38 percent of Hispanic workers have access to an employer-sponsored retirement plan.

If you don’t have a retirement plan at work and don’t know how to get started, you’re in luck. The U.S. Treasury Department recently launched my RA, a new simple, safe and affordable way to save for retirement. myRA has no fees, and you won’t risk losing money on what you save. You can easily create an online and fund it from your checking or savings , paycheck, or tax refund. And with no minimum balance or contribution requirements, you can save the right amount that fits your budget.

While your retirement savings should be a long-term investment, we recognize that unexpected expenses or financial emergencies can come up. Because myRA is a Roth IRA, savers can withdraw the money they put into the tax-free and penalty-free. And the interest you earn can be withdrawn tax-free later on during your retirement years.

Since the launch of the program late last year, we’ve seen people all over the country start saving. Mariela Ortiz is one of them. Since she moved to the U.S. from Cuba fifteen years ago, Mariela has worked many jobs to her two sons, including at her current job at LaSalle Cleaners. She’d been thinking about saving for a long time, but wasn’t sure how to start. So when Beatriz Navarrete, LaSalle’s human resource manager, told her about myRA, Mariela opened an . Mariela reflected that this step was “important for me because it’s my future.”

myRA is a great tool, but we also know that automatic enrollment in retirement savings plans would dramatically improve participation rates. Research shows that about 9 out of 10 workers who are automatically enrolled in 401(k) plans stay in the plan and make contributions – a far higher rate than what we see for workers who must sign up on their own. This is why the istration has encouraged automatic enrollment in 401(k) plans and the President has proposed automatically enrolling workers who lack a 401(k) or other retirement plan at work into Individual Retirement s (IRAs). While Congress has yet to take action on the President’s proposal, several states are implementing a state-level version of the President’s automatic IRA proposal.

I encourage everyone who hasn’t begun saving to start tucking away some money each month. myRA makes it easy to take the first step, and you can learn more and sign up at myRA.gov.

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