The R-Bond ("Retirement Bond") was supposed to launch in January 2014; it's now March 2015 and still no sign... or even another mention in the media! The idea's a simple alternative to ETF-based strategies for starting an IRA in the double- or triple-digits, but the concept still seems ill-defined and unlikely to materialize in the short-term. It doesn't look like it will offer any advantage if you already contribute to a normal IRA, but removing the earned-income requirement and allowing them to be rolled over into an IRA could provide a solid option for graduate students who aren't eligible for IRA contributions.
These should not be confused with old, obsolete "U.S. Individual Retirement Bonds" (1975-1982) or "U.S. Retirement Plan Bonds" (1963-1982).
I have a feeling that the R-bond plan was supplanted by the myRA. Both are discussed in this Bogleheads forum post.
For retirement, are R-Bonds right for you?
via: http://www.marketwatch.com/story/for-retirement-are-r-bonds-right-for-you-2013-11-09/ (2013-11)
"Yes, the Treasury Department, which first began working on the program in 2009, will roll out in January retirement or R-Bonds to encourage savings by Americans not enrolled in a company-sponsored pension, according to a recent Financial Advisor magazine report."
"Mark Iwry, a deputy assistant secretary for retirement and health policy at the Treasury Department, said the R-Bonds “would have the tax characteristics of an IRA and be eligible to be rolled over into an IRA once the savings reach a now-unspecified threshold,” according to a recent report in Financial Advisor magazine."
"According to the magazine, Iwry said that “the R-Bonds would be aimed at workers at companies that don’t sponsor retirement programs of any kind, part-time employees not eligible for plans their companies sponsor, and the self-employed or not employed.”"
This is the Financial Advisor report cited in this article: Retirement Bonds On Front Burner Of Treasury Department. This source and this presentation states that it would target the self- and un-employed, while another article written the same day—Treasury weight 'retirement' bonds—states that "Only full-time employees whose employers offered no retirement savings plans would be eligible to buy the bonds...". Both reference the same original source: a presentation by Mark Iwry, assistant secretary (tax policy) for retirement and health policy at the US Treasury, to the Women’s Institute for a Secure Retirement annual symposium in Washington, D.C.. The presentation appears in the symposium agenda but is not among those available for download.
Administration explores 'R bond' as option for retirement accounts
via: http://www.investmentnews.com/article/20090607/REG/906059955 (2009-06)
"He said that officials have discussed the possibility of making a low-risk life-cycle or target date fund the default investment option for these auto-IRAs, which would be mandatory for employers if they don’t offer a retirement plan to their workers. But there is also a chance that they could rely on a new form of bond — an “R bond” — as the basic building block for the auto-IRA, Mr. Iwry said in addressing reporters at the Treasury Department in Washington last week."
"R bonds, Mr. Iwry said, could serve as the “training wheels” that would allow workers’ auto-IRAs to grow to the point where they would be more attractive to the financial services community. Essentially, these bonds would serve as the bridge between the public and private sectors in the auto-IRA program, he added."
I decided to try contacting the US Department of the Treasury to see what the status is:
Name: Brandon Curtis E-mail: firstname.lastname@example.org Topic: Treasury Bills, Notes, Bonds, and TIPS Message: This article (and several others) mention an R-Bond ("Retirement Bond") program in the works: http://www.marketwatch.com/story/for-retirement-are-r-bonds-right-for-you-2013-11-09/ "...the Treasury Department, which first began working on the program in 2009, will roll out in January (2014) retirement or R-Bonds to encourage savings by Americans not enrolled in a company-sponsored pension, according to a recent Financial Advisor magazine report." Has there been any further progress or announcement on this program? Thank you! -- Brandon
I will update when I hear back.