Rhode Island retirement plan prevents many state workers from accessing contributions

Retirement Crisis & Investment Security - A growing retirement crisis is anticipated, with individuals over 65 expected to comprise one-fifth of the US population within the next 5 years [1] - Millions are worried about the security of their investments and whether they will have enough savings for retirement [1] - Thousands of state employees in Rhode Island are locked in retirement plans with restricted access to their money [2] Rhode Island 401A Plan Issues - Rhode Island's pension system was overhauled in 2011, introducing 401A accounts for state employees [4] - Participants in the Rhode Island 401A plan cannot borrow against, withdraw from, or transfer their savings to other qualified investments until they stop working [5][6] - Two state employees have nearly $250,000 locked up in their accounts [7] TIAA & Annuities Concerns - TIAA manages retirement plans for 5 million clients, primarily nonprofit and government workers, overseeing over $1 trillion [8] - Annuities are criticized for lacking diversification and having higher fees [9] - Participants in the annuity are estimated to pay TIAA $4 million this year alone, significantly more than a lower-cost provider like Vanguard [10] - TIAA paid $97 million in 2021 to settle allegations of pushing clients into higher-cost accounts [10] Regulatory Scrutiny & Lawsuits - Regulators in Montana and Washington are probing allegations against TIAA related to sales practices [11] - AARP Foundation is joining a class action suit against TIAA as co-counsel [11]