Treasury building in Washington.

The Treasury Department said Friday that it plans to wind down the myRA, the retirement savings program launched by the Obama administration in 2014, after a “thorough review” by Treasury found the program was not cost effective.

Demand for and investment in the myRA program has been “extremely low,” Treasury said, and has cost $70 million to manage since 2014. Participants in the program have contributed $34 million to their accounts.

Jovita Carranza, U.S. treasurer, said in a statement that the myRA program “was created to help low- to middle-income earners start saving for retirement. Unfortunately, there has been very little demand for the program, and the cost to taxpayers cannot be justified by the assets in the program. Fortunately, ample private-sector solutions exist, which resulted in less appeal for myRA.”

Treasury plans to phase out the program over the coming months, Carranza said, and “will be communicating frequently with participants to help facilitate a smooth transition to other investment opportunities.”

Participants in the myRA program are being notified of the upcoming changes, including information on moving their myRA savings to another Roth IRA.

Since inception in 2014, 20,000 accounts with a median balance of $500 have been set up, while an additional 10,000 accounts remain empty.

If the program continued, Treasury said that it would costs taxpayers approximately $10 million a year to manage. 

Retirement savers have options in the private sector that offer no account fees, no minimum balance, and safe investment opportunities, Treasury said.

Obama’s myRA worked liked a savings bond for moderate-income workers.

Treasury is directing participants to for additional information or to call myRA customer support with any questions. 

“We are committed to promoting retirement savings, and, as treasurer, I plan to devote a substantial amount of my time to ensuring more Americans have the tools and know-how to save for retirement,” Carranza said.

— Check out 2 Tax Credits Retirement Savers Probably Don’t Know About on ThinkAdvisor.