Attention Rhode Island employers…do you offer a qualifying retirement plan for your employees? Under the RI Savers Program, businesses with five or more employees that do not currently offer a qualifying retirement plan are required to facilitate RI Savers or set up their own independent plan, such as a 401(k). Employees can elect to enroll or not. Compliance deadlines are approaching in 2026. Here’s an overview to help you understand your options.

Why This Matters

Choosing between RI Savers and a traditional 401(k) isn’t just an administrative decision, it can directly impact your employees’ retirement readiness, your business’s compliance obligations, and your ability to attract and retain talent. Understanding the differences now helps businesses plan strategically and avoid penalties as compliance deadlines approach.

What is the RI Savers Program?

Enacted in June 2024, RI Savers is a state-managed retirement savings program that allows employees to save for retirement through payroll deductions into a Roth individual Retirement Account (IRA).  Employees are automatically enrolled at a default rate of 5% but can adjust contributions or opt out entirely. 

The program is sponsored by the Rhode Island Office of the General Treasurer and Vestwell State Savings, LLC (Vestwell) is the program administrator. Vestwell and The Bank of New York are responsible for daily program operations.

RI Savers fees include annualized asset-based fees, a fixed account fee, a program administration fee, and certain additional fees for specific events, such as withdrawals by paper check. Detailed fee information is available in the official program description.

Employers who offer a qualified plan such as a 401(k), 403(b), SIMPLE IRA, or SEP IRA can choose to opt out of RI Savers.

Compliance Deadlines for Employers

RI Savers enrollment is being phased in based on business size (defined by the number of employees regularly employed by the business):

• Businesses with 100+ employees: must comply by October 15, 2026
• Businesses with 50–99 employees: must comply by October 15, 2027
• Businesses with 5–49 employees: must comply by October 15, 2028

Employers with fewer than five employees are not required to participate. The state will provide a notice of noncompliance before taking further action, giving businesses time to adopt a plan or facilitate RI Savers enrollment.

Key differences between RI Savers and a qualified employer-sponsored plan

Here’s what Rhode Island employers should consider when comparing RI Savers to a traditional 401(k) or other employer-sponsored plans:

1. Automatic enrollment vs. employer control – RI Savers handles enrollment automatically, while a 401(k) requires more administrative effort but allows tailored plan design.
2. Cost and contributions – RI Savers has low administrative burden but does not require employer contributions; a 401(k) may include matching contributions that can incentivize retention.
3. Compliance and deadlines – RI Savers deadlines are phased by business size, giving smaller employers more time to comply. A 401(k) must meet federal ERISA requirements from the start.
4. Employee flexibility – Employees can opt out of RI Savers at any time, and employers can adjust contribution rates. 401(k) plans can be more flexible with loans, certain withdrawals, and additional investment options.

For businesses weighing RI Savers against a 401(k), the decision ultimately comes down to balancing simplicity, compliance, cost, and employee engagement. While RI Savers offers a convenient default option, employers with the resources and desire to customize their retirement benefits may find a 401(k) plan a more strategic choice for attracting and retaining talent.