These are the differences between a standard IRA and the new MyRA vehicle:
|Source||Before-tax money||After-tax money|
|Limits||$5,500 per year||$5,500 per year|
|Withdrawals||Subject to income tax||Not subject to income tax – tax has already been paid|
|Early withdrawal||10% penalty before age 59.5 (as to earnings only)||No penalty|
|Invested||Any vehicle – CDs, stocks, bonds, mutual funds||Governmental account paying interest|
|Can lose money||Yes||No|
According to the regulation, issued by Treasury in December 2014, the custodian of the accounts will invest the proceeds in a new investment vehicle called "Retirement Savings Bonds" which will not be held by individual savers. Rather, they will be held by custodian. Interestingly, there has been no announcement of who that custodian will be.
When the amount in the account reaches $15,000, or after the individual has participated for 30 years, whichever comes first, eligibility is at an end, and the individual will then be required to move the funds to a Roth IRA sponsored by a bank, credit union, or financial adviser.