Ask the Expert: CORE 401K Plan for Nonprofits

Written by
Saleha Walsh

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Dear HR Expert,
I am a Director at a Massachusetts nonprofit and I recently was at a workshop where the CORE plan was mentioned. It sounds like it would be an excellent 401(k) option for my organization. How do I know if I am eligible and what are the advantages/disadvantages of participating in such a plan?
Looking to Save

Dear Looking to Save,
Let’s start with the basics. The Massachusetts Defined Contribution CORE Plan (the “CORE Plan”) is a state-sponsored 401(k) retirement plan designed specifically for small Massachusetts nonprofit organizations. Nonprofit organizations operating in the state and employing 20 or fewer staff may adopt the CORE Plan. This Plan is a multiple employer 401(k) retirement plan which allows for nonprofits to combine their plan assets, reducing the cost of offering a 401(k) plan to employees. As CORE Plan sponsor, the Office of The State Treasurer assumes a number of administrative and fiduciary responsibilities on behalf of participating employers.

Some of the key features of the CORE Plan include:

  • A reasonable initial start-up cost of $2,500 plus small annual administrative fees
  • Pre-tax and Roth (post tax) contribution options for employees
  • Automatic enrollment (employees can opt out)
  • Higher contribution limits versus some other plans often offered by small organizations and the potential for employer-matching contributions


  • Potentially lower cost for your organization
  • The cost to the employee is much lower. No deferred sales charges or contractual obligations are passed on to CORE Plan participants
  • Access to Plan representatives and a participant website, which includes individual retirement income projections


  • No loan provision
  • Limited fund selection
  • No employees can earn over $120K (unless the company is willing to do a match)

For small nonprofits, the CORE Plan can offer a cost effective option that allows you to offer candidates & employees an in-house retirement plan. For more information or questions on the CORE Plan, contact us at or 781-235-1490.