Lew: Government retirement plan a ‘stepping stone’ to healthy nest egg

Treasury Secretary Jack Lew is touting the government’s efforts to help Americans take the critical step of saving for retirement.

In an op-ed published by Yahoo Finance, Lew made the case for the government’s new myRA savings plan, which allows low- and middle-income Americans to begin saving for retirement through government-run accounts.

{mosads}The program, announced by President Obama in his 2014 State of the Union address, has just gone live across the country.

“Our goal is to make sure that every American is not only encouraged to save, but has the tools they need to create a financially secure retirement,” wrote Lew. “MyRA alone will not solve the nation’s retirement savings gap, but it will be an important stepping stone for encouraging and creating a nation of savers.”

The president launched the new savings program as part of a package of policy shifts aimed at closing the gaps between the country’s haves and have nots. Noting that many Americans were lacking sufficient savings for retirement, and that Social Security alone can’t support retired Americans, the White House created a fee-free government savings program that is intended to be as accessible as possible.

Americans can invest in a no-tax savings account for as little as $25 up front, and $5 each month. The program is aimed at working Americans who lack access to an employer-sponsored retirement plan or other options. The goal of the program is to allow Americans to transfer their government plans to a private-sector program once it has grown in size.

Lew noted that the program carries virtually no risk, since the investments are backed by U.S. government savings bonds, widely seen as the safest investment possible.

“The bottom line is that it doesn’t matter how much you start with as long as you can make it a habit. Over time you’ll watch your savings grow into the foundation for a secure retirement,” wrote Lew.