Targeting Americans who don't have plans through theiremployers, President Obama is hoping the launch of a new plan willget them started on saving for retirement.

The myRA will be offered via a Roth individual retirementaccount where savers will benefit from principal protection, so theaccount balance will never go down in value, according to a briefon the White House's website.

The security in the account, like all savings bonds, will bebacked by the U.S. government and contributions can be withdrawntax free at any time.

Initial investments could be as low as $25 and contributionsthat are as low as $5 could be made through payroll deductions.Savers have the option of keeping the same account when they changejobs and can roll the balance into a private-sector retirement account at any time.

Participants could save up to $15,000, or for a maximum of 30years, in their accounts before transferring their balance to aprivate-sector Roth IRA.

Savers will earn interest at the same variable interest rate asthe federal employees’ Thrift Savings Plan Government SecuritiesInvestment Fund, according to the White House.

The myRA would be available to households earning up to $191,000a year.

The accounts will be offered through an initial pilot program toemployees of employers who choose to participate by the end of2014.Workers would not be required to contribute and are free toopt out, the White House said. Employers are also not required tocontribute. The plan would help defray the minimal administrativecosts of establishing auto-IRAs for smallbusinesses,including through tax incentives.

During his recent State of the Union address, Obama introducedthe myRA. He said he will use his executive authority to direct theDepartment of the Treasury to create the account.

About half of all workers and 75% of part-time workers lackaccess to employer-sponsored retirement plans, according to theWhite House.

For credit unions and others, the myRA has its pluses andminuses, said Jeff Gorton, a CPA, Certified Financial Planner andinvestment adviser representative with AlphaStar Capital Managementin Cornelius, N.C.

“Americans are typically terrible at saving, so if the myRA canencourage savings I am all for it,” Gorton told Credit Union Times.“For people that are nervous about put their hard-earned dollars involatile investments, this is a very low-risk method of investing.But the returns are unlikely to keep pace with inflation.”

For investors with a longer time horizon, Gorton said historyhas shown that portfolios having stock market exposure will keeppace with inflation better, and outperform the other assetclasses.

Gorton said he would like to see the myRA account expanded toinclude all five funds that the Thrift Savings Plan currentlyprovides. This would equip savers with more options at a lowexpense ratio for each fund, he pointed out.

While encouraging people to save and invest is laudable, thepresident's MyRA essentially duplicates the Roth-style plansalready available, said Jason Fichtner a senior research fellow atthe Mercatus Center at George Mason University in Fairfax, Va.

“The president's efforts would be far better spent reformingSocial Security to ensure all workers can enjoy a secure anddignified retirement,” Fichtner suggested.

Obama's new retirement account proposal comes at a time whenconsumers are saving more, said Dan Geller, executive vicepresident of Market Rates Insight, a San Anselmo, Calif., researchfirm.

“When economic conditions are tough, consumers act in a similarinstinctive manner by increasing their savings as a measure ofself-preservation,” Geller explained.

As proof, he pointed to the recession period from December 2007to December 2009 when consumers increased their pace of banksavings by $100 billion compared to the previous two years.