The researchers envisioned a strategy that, during the bridge period, would convert between 20% and 40% of a worker's 401(k) to income.
To survey people's receptiveness to the plan, researchers used a pre-existing, nationally representative panel of U.S. pre-retirees created by NORC (formerly known as the National Opinion Research Center) at the University of Chicago. All respondents were between 50 and 65 years old, were not retired, and had balances of at least $25,000 in their 401(k), the report said.
The pool of 1,349 respondents was then divided into four groups. The "control" group was given basic information about how a bridge option would work. The second "insurance" group was given a description that framed the option as a form of insurance. The third group, the "more information" group, was given more details on the plan than the control group. Finally, the fourth group, called the default group, was asked about a plan that would be a default feature of their employee 401(k) plans.
After the survey was conducted in July, researchers found that the "additional information" group was most receptive to the plan, with 35% saying they would participate. They were followed by the "insurance" group at 32.7%, the "default" group at 31.3% and the control group at 26.8%.
The report said that, given this was the first time the respondents had heard of such an option, the results indicate the idea is viable.
"The results indicate a substantial interest in the bridge strategy," the report said. "This strategy is novel, and the survey is likely the first time respondents would have encountered the idea of drawing down their 401(k)s to postpone claiming Social Security. The fact that over one-quarter of respondents would adopt the strategy based on such limited information as the control group had is noteworthy."
The way the bridge option is framed could have a significant impact on how many people participate, the researchers noted. They pointed to the increased acceptance among the groups that received more details, or in which the option was described as a form of insurance or a default plan feature. "A simple nudge can dramatically increase usage of the bridge option," the researchers said.