PENSIONS AT RISK FROM SHARES PLUNGE

Some five million workers are paying into defined contribution schemes - and if they opted for the default fund, all their investments could be in shares, The Pensions Advisory Service (TPAS) said.

With such schemes, also known as "money purchase" plans, amounts paid out at retirement depend on the performance of shares.

Malcolm McLean, of the TPAS, told BBC Radio 5 Live: "My concern is people think the default fund has been recommended to them and that it's appropriate for them personally, which it may not be, because it may be 100% invested in shares.

"But they may actually be taking more risk than they know about and are comfortable with."

The value of personal pension funds had dropped by almost a fifth this year as a result of turbulence on the stock market, the TPAS said.

A recent report showed retirement savings have lost in excess of 10% of their value in the last month alone as credit-crunch hit investors attempt to offload their shares.

However, the National Association of Pension Funds said default funds should shift members' money away from shares to safer investments as they approach retirement.