Episode 154: In response to listener questions, here are my thoughts on the myRA program- it’s a good account for the beginning SAVER.
There are no minimums, no fees, and the principle is guaranteed; like a ROTH the gains are forever tax free and the principle is always available without penalty. Long term interest is paid with the benefit of short term liquidity. [NOTE- because the investment is fully guaranteed, there would be NO LOSS of PRINCIPLE should interest rise.]
The downside is that there is only one investment option (a US Treasury index) and that the total account value is capped at $15,000.
For the beginning SAVER, the pros far outweigh the cons. [Note the emphasis is on SAVER, not INVESTOR.]
Learn about it at: www.myra.gov
One last comment- for those that use the myRA as a place to park emergency fund savings…they’re over-thinking the issue. Listen to this episode for details.
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