Given that these people had jobs, and based on the stats in the article generally well paying jobs, I would assume they were spending out of their budget for things they don't really need in an effort to keep up with the neighbors or appearances. But it beats not saving for retirement at all. Social Security isn't enough by itself for most people.

The problem isn't the 401k itself, it's that some people spend too much money.

Participation in 401(k) plans (unfortunately) pick up more as individuals get closer to retirement; younger employees often do not participate at all or make minimal contributions. These older employees tend to have additional expenses such as college tuition for children that younger employees would not. The article doesn't indicate what type of debt the participants are accumulating.

Many employers match a certain amount of employee contributions to 401(k) plans. Not maxing out on the employer match is essentially taking a pay cut. I could see some folks electing to accrue some debt in order to get more employee contribution.

The illusion is coming out on top or getting ahead in some way.