At the request of President Donald Trump, the Treasury Department has dissolved a regulation that was supposed to help low-income families save for retirement, but instead cost taxpayers $70 million, with little benefits for those in the program.
According to The Washington Free Beacon, the myRA program was put in place by President Barack Obama in 2014. While the former president promised that the retirement savings program would help millions, only 20,000 signed up within the first two years. About 10,000 additional members signed up after that, but failed to put a dollar in their accounts.
In fact, those who used the program only had an average of $500 in their accounts.
Meanwhile, taxpayers — including the kind of retired people the program was supposed to be helping — shelled out millions to keep the failing bureaucracy live. Over the past three years, taxpayers gave more than $70 million, and that number was estimated to grow until Trump’s White House put a halt to it.
U.S. Treasurer Jovita Carranza explained why the Trump administration shut the program down. “Unfortunately, there has been very little demand for the program, and the cost to taxpayers cannot be justified by the assets in the program,” he said, according to The Free Beacon.
Market Watch called the alternative retirement savings program “a good idea with terrible execution.”
Even USA Today agreed that there are better ways for low income individuals or families to save for retirement. Some programs they cited include the Roth IRA.
Experts seem to conclude that with a Roth IRA account is in fact a better alternative than myRA.
Steve Minkoff, a certified financial planner in San Francisco explained why myRA isn’t necessary, given the great benefits that alternative retirement plans provide.
“A Roth IRA is a great alternative; an investor would likely see better returns because they are moving from one government fund to an open investment architecture,” Minkoff said.
So why did President Obama push the need for myRA in the first place? Simply put, it isn’t a necessity for Americans to survive, and there are already alternatives available for those whose workplaces don’t provide a retirement savings account. Plus, taxpayers shouldn’t hold the financial burden for such a pointless program.