STUDIO CITY (CBSLA.com) — The U.S. Treasury Department has come up with a risk-free way to assist citizens who are without a 401K or retirement plan through their jobs.
The retirement savings plan, called “myRA”, or My Retirement Account.
“It’s great, I think my employees would love it,” store owner Nick Asanad said. “For my employees, the younger high school students, eighteen, nineteen, twenty years old, they need to start saving sooner rather than later.”
The plan is a Roth IRA, in which the participant chooses a contribution amount. The savings money can come from your paycheck, bank account, or a federal tax refund. The maximum contribution amount is $5,500 per year, or $6,500 if you are over the age of 50.
Additionally, once the account reaches a $15,000 maximum, that money must then be transferred to another account.
“It gets people to save, and people really don’t do enough of that,” Ventura Advisors President Jeffrey Harwood said. “Typically people who have stocks and bonds in an investment portfolio would put their growth investments, their stocks, in an account like this, but the government doesn’t offer that. What they’re offering is a fixed-income, a bond option.”
Small business owners, meanwhile, say it is a step in the right direction.
“Personally as a business owner, I can’t afford that for my employees,” Asanad said. “The fact that the government is going to do that, I think it’s great.”
Anyone interested in signing up for a myRA can do so through the government website, or by calling, free of any fees.