Rhode Island and Connecticut announced last week a new partnership that will provide retirement savings programs for uncovered private sector employees in the Ocean State.
The RISavers Program, created by the Secure Choice Retirement Savings Program Act, will partner with an existing program in Connecticut to offer retirement planning benefits to Rhode Islanders who do not have an employer-sponsored option.
“Over 170,000 Rhode Islanders lack access to a retirement savings plan at work. With this strategic partnership, Rhode Island has taken the first step to closing the retirement savings gap. Everyone should have the ability to retire with dignity and financial independence,” said General Treasurer Diossa in a statement. “Through this interstate agreement, we gain an experienced partner that will help Rhode Island implement RISavers quickly and administer the program efficiently.”
According to the statement, employees at eligible businesses will be automatically enrolled to save but can opt out of the program at any time. The individual retirement accounts (IRAs) will follow employees throughout their career and are portable so savers can choose their preferred risk level and contribution rate.
Contributions to the program will be processed as a payroll deduction. Matching contributions are prohibited by law.
The Rhode Island Treasury will launch a pilot program in the spring of 2025. A full launch of the program is expected shortly after and will be administered by Vestwell.
“Vestwell is excited to see the expansion of partnerships between states as a pathway to efficiently scale and provide access to retirement savings,” said Douglas Magnolia, president of Vestwell State Savings. “These vital savings programs empower more individuals with the tools they need to build a brighter financial future. We look forward to working with Rhode Island and Connecticut to bring this partnership to life in 2025.”
The interstate partnership with Connecticut is the second of its type in the U.S., with Colorado having partnered with Delaware and Vermont on state-run plans. Connecticut first launched its program, MyCTSavings, in 2022. Since then, nearly 30,000 Connecticut residents have saved over $33 million dollars.
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
