Massachusetts Defined Contribution Core Plan

Year enacted

2012

Status

Launched in October 2017 and open for employer registration and employee enrollment

Employers affected

Nonprofit organizations with up to 20 employees; plan is 100% voluntary

Type of plan

Multiple employer plan–401(k)

Automatic enrollment

Yes

Auto-escalation

Yes (1% or 2% at employer’s election, up to 15%)

Default contribution rate

6%

Employer contributions

Permitted; safe harbor matching contribution equal to 100% of the first 3% of the participant’s contribution, and 50% of the next 2% of the participant’s contributions, OR safe harbor nonelective contribution equal to at least 3% of each eligible participant’s compensation

Investment options

CORE target-date funds (TDFs), a CORE growth fund, a CORE income fund, a CORE inflation fund, and a  CORE capital preservation fund; a professionally managed account option is available for a fee

Default—12 CORE age-appropriate TDFs

Administrative fees

Per the CORE plan adoption brochure: an annual employee fee of $65, and other administrative service fees that apply to elective plan features used by a participant; “each investment option has an administrative, advisory, and investment management fee that varies by investment option," and “additional fees, including administrative and other service fees, may be assessed over time.”

There are also fees for the employer, including a one-time installation fee, an annual plan administrative fee beginning in the second year, and an annual compliance fee (based on plan design: fee for employer contribution election and fee for deferral-only election)

Website

 CORE Plan for Nonprofits