Have you heard about MyRA?
President Obama mentioned it in his recent State of the Union address, and it’s been a hot topic on political and financial blogs.
We were curious about it, so EVG founder and president Mike Dillard hopped on a 5 minute Skype call with Rich Desich from Equity Trust. Rich is one of our trusted EVG advisers when it comes to IRAs and saving for retirement.
Rich mentions that the MyRA is an old idea with a new name. It’s basically an automatic savings tool for lower income folks who wouldn’t otherwise set up their own IRA or don’t make enough money to justify opening a self-directed IRA.
So is MyRA a good choice for the poor?
Mike points out that since MyRA funds would be invested in U.S. Treasuries, the returns are less than inflation. Rich points out that it gets more people saving and thinking about their financial future.
Here's a recording of their conversation:
So what do you think? Is MyRA a good idea?
We’d love to hear from you, so please leave your comment below.
Note: EVG partners with Equity Trust to teach people how they can invest their IRA savings in almost anything they want like real estate, precious metals, business, tax liens, livestock, timber, etc. (not just Treasuries like the MyRA). It’s one of the many ways we help EVG members “Invest like the rich.”
Mike: Hi everybody! Mike Dillard here with the Elevation Group. We wanted to shoot a quick video with one of our in-house experts, Rich Desich from Equity Trust Inc. on a topic that’s really hit the news over the last week specifically in President Obama's State of the Union address which is about the new MyRA Program. And Rich, you and Trust Equity are, we know really the preeminent company when it comes to IRA's and things like that here in the US. And so I thought we'd can pull you up on Skype and do a quick five to 10-minute chat really to see what that program is about, who it’s applicable for and any other kind of insights that you might be able to share with us today.
Rich: Sure. You know Mike, the program that you are talking about here, it was just announced by the President a short time ago, it's actually been something the folks in the Treasury Department have been talking about for quite a while. And from a macro issue, the reason why that that was put forth is that as a country we have a very big problem with folks saving for the retirement. And we have a low propensity to save especially for folks who are in the lower income bracket; it's very difficult for them to get on that track. So that's been kicked around for many years and it was actually called the auto IRA and I think what it really is, this is automatic IRA and that's the title. For several years, people have been working and working and seeing how that they can make that proposal to try to address that problem of people not being able to save for retirement.
Mike: So what are the specific numbers around this, minimum investment, maximum investment because I kind of read over the brief here this morning before our chat to get familiar with the program myself and you really nailed it when you said that this is really for in the lowest economic bracket that there is, people who wouldn’t qualify for a regular IRA, correct?
Rich: Yeah. Well, technically the people would qualify for an IRA but it's kind of a mindset for those folks who are having a little bit more of a challenge with their salaries and not really having the mindset to be saying, “I'm going to be putting this money away”. It's more kind of I get disposable income and spend it. So the idea is to get something along the lines of auto deduction from a payroll standpoint or have it just deducted right out of their checking accounts. So the people can get in the habit of starting small and becoming a saver. So they can start off $5, $10, $15, $25 a week, getting people into that habit of saving for the retirement up to $5500 a year is what the current proposal states.
Mike: Yeah. It's such an interesting dichotomy when, you know, looking at where that money is being invested by the government, it's essentially an equivalent of a bond program that's yielding about 1% which is much less than inflation right now. So it's interesting that the more people put in to that program, the more they lose right off the bat through inflation. And am I right when I really think about this just as you said to get people into the habit of saving because I really don’t understand the difference between putting money into this program and a regular checking or savings account that can then be put into a normal IRA program or the stock market or whatever it may be other than the fact that these people need so much help that they need it automatically deducted from their payroll and put into an account where they're going to lose money every year on it from inflation… but it's better than nothing. Is that kind of the summary about this?
Rich: You know, at a 50,000 review, that covers a lot of it, Mike, you know, it's really — it is again for some folks who just don’t have that inclination right now to save, it gives them a vehicle to put money into it and become part of the saving program. You know, 50% of the workers in United States do not have a retirement plan program, 75% of part time workers don’t have any sort of retirement program and that's a big, big problem.
Mike: That's crazy. I had no idea that it was that high.
Rich: Yeah absolutely huge. So we really have to get more people kind of under that umbrella and if it means starting out small and helping them get into the habit and then they can graduate into a normal IRA or 401k retirement plan. That's the idea behind the program.
Mike: So Rich, any other additional thoughts about the program or really how you think it will actually benefit people?
Rich: Absolutely Mike, you know, I think it is a tremendous program. I think although it might not be relevant to some of the folks that are listening right now for them personally from a macro sense and all of as Americans and we have to really, when you look at the national debt and you look at the inflation and all of those issues that we have from that macro sense, you know, one of the reasons why that we have this money is that we have to take care of folks as they get older. And by having people become more self-reliant and being able to become part of the saving mentality that will benefit themselves. This is a really good proposal. It's a good start. And I hope they propose additional programs like this because it really will benefit all of us.
Mike: It's interesting, very cool. Well, Rich Desich, thanks so much, appreciate you joining us here today and again guys, from Equity Trust, go ahead and look 'em up. They're one of our most valued experts here at the Elevation Group and we always appreciate your time so much Rich here, thank you once again.
Rich: Absolutely, thank you Mike.
Mike: You bet. Take care.
Elvemunninger i det tilbakevendende havet. tadalafil Når det gjelder forurensninger fra fosteret eller fosteret, stilles diagnosen ofte ved cytologisk undersøkelse av væske oppnådd ved pleurocentese eller sprint.