If you’re looking for an indication of government success in promoting retirement savings, especially in light of recent state-initiated 401k and IRA plans, myRA may be it.
Announced with great fanfare by President Obama in his 2014 State of the Union address, the Treasury Department developed the framework for the government-sponsored IRA program over the next 10 months, implementing the plan in November 2015.
So a little over a year later, how’s it going?
About 20,000 people have signed up for a myRA to date, the Treasury Department told CNNMoney in mid-December. As the network notes, “it’s a paltry number when compared to the roughly 55 million workers who don’t have access to an employer-sponsored retirement plan.”
“myRA is designed to remove common barriers to saving, and give people an easy way to get started,” Treasury Secretary Jack Lew said upon its nationwide release last year. “myRA has no fees, no risk of losing money and no minimum balance or contribution requirements. To make saving easier than ever, you can now put savings into myRA directly from your bank account.”
According to a 2015 Federal Reserve Report, 31 percent of non-retired people said they have no retirement savings or pension whatsoever. Additionally, a 2013 report by the National Institute on Retirement Savings found that the average near-retirement household had only $12,000 in retirement savings.
Among workers who do not participate in a 401(k) or other defined contribution plan, 42 percent say it’s because their employer does not offer one. Furthermore, among part-time workers, a 2015 BLS Economic Release found that 62 percent don’t have access to a retirement plan at work.
But it’s not all bad news, and some retirement experts told CNN that they predict the number of enrollees will start rising fast.
“I think Treasury was taking a very careful, measured approached to make sure everything works—but the future of myRA is very bright,” David John, an adviser at the AARP Public Policy Institute, told the network.
He expects awareness of the program to grow, “bolstered by new state programs that promote myRA.”
The Treasury Department also said it will do more next year to highlight myRA on government websites, as well as promote it through TurboTax.