"They thought it would be hard to get people who were living paycheck-to-paycheck to sign up unless they thought they can get their hands on their money in a loan," VanDerhei said.
A study VanDerhei did in 2001 showed the loan option made a big difference in how much a person was willing to contribute.
But that was before the financial crisis of 2008 and before the age of auto-enrollment.
Today's under-40 generation does not pay much attention to the details of retirement plans they get at work, and it is unlikely that any change would prompt them to start opting out in huge numbers, VanDerhei says.
Huge Consequences
While it is alarmingly simple to borrow from your 401(k), borrowers may sometimes have to pay set-up fees. The low interest rate charged is actually credited back to your own account as you repay.
The consequences in lost growth, however, can be monumental.
Fidelity Investments estimates that a person who takes one loan out - the average balance they see is $9,000 - is set back about 7.6 percent from his or her long-term retirement goal.
Half of Fidelity's borrowers end up with more than one loan. The real-dollar impact is between $180 and $650 a month in retirement, according to the company's estimates.
It is not just the loan balance that affects the retirement account. Of the 20 percent who borrow, Fidelity has found that 25 percent lower their savings rates within five years of taking a loan, and another 15 percent stop saving altogether while the debt is outstanding.