Ask Matt: What's the top problem with myRA?

Ask Matt: What's the top problem with myRA?Q: What's the biggest problem with myRA?

A: MyRA is a new tool designed to help make saving for retirement a bit easier. But these accounts have a drawback that means they will likely fall short.

The MyRA retirement savings is one option for households that normally don't have much access to retirement savings plans from their employers. These plans charge no fees and there's no setup charge. Appealing to low and middle income Americans, the new plan allows for contributions of any size, even if just $2. The plan allows for contributions of up to $5,500 a year, or $6,500 a year for Americans who are 50 years old or older. The plan invests in U.S government securities meaning there's little risk of losing principal - a comforting thought to some.

But the fact the plan invests in U.S. government securities is also a hitch, says Bob Johnson, CEO of the American College. Treasury investments over the long term will most likely just keep pace with inflation. Savers need more stocks to generate real returns, he says. A dollar invested in Treasuries would likely grow to $4.32 or less in 30 years. That same dollar could grow to $17.45 if invested in stocks. That kind of appreciation is needed to meet long-term goals, like retirement.

"myRA was developed for individuals looking for a simple, safe and affordable way to start saving and investing. It’s a starter account that serves as a bridge to other retirement savings and investment products. At any time, savers can transfer their funds to a private sector Roth IRA where they can continue to watch their savings grow," says Dan Watson, Treasury spokesman.

USA TODAY markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.