You can make a case for many different styles and types of investments, but it’s impossible to defend apathy and ignorance as reasons for deciding on an investment strategy.

Yet that is the case for an estimated 2.7 million members of defined contribution (DC) pension plans in the UK.

This large group are invested in default funds, set up for scheme members unable or unwilling to make an active decision once they have joined a DC scheme.

Now, both the use of default funds and the scale of their usage is causing concern and leading some to develop new solutions.

At present, the most popular default fund option is a lifestyle investment policy which gradually switches investments from equities to bonds and cash as the planned retirement date approaches.

The theory is that equities are better when growth is sought, but as retirement nears less risky investments should be used.

However, this approach has its critics.

Life-styling assumes the retirement date is known in advance and does not allow for redundancy or ill health forcing an early exit.

Lifestyle funds are also built on a ‘one size fits all’ basis and do not attempt to meet different individual preferences.

This might not be a problem, but many DC members apparently think their default fund is set up with them in mind.

Excessive use of default funds is also seen as a sign of lack of engagement with scheme members and a lack of interest in what should be a valuable employee benefit – both should cause concern to employers and scheme administrators.

Two alternative approaches to default funds are now being mooted by different UK pension providers.

Norwich Union, part of the Aviva group, is talking about creating a more complex matrix of underlying funds as part of a default mechanism.

Members would be quizzed on their risk preferences and depending on this, together with the age group, they would be allocated to a fund better tailored to their needs than a single lifestyle strategy.

A second idea from JP Morgan Asset Management is to use absolute return funds, aiming to achieve a cash plus return, for default investors.

This, it is argued, would give consistent returns over time. In contrast, an equity-based approach will not be popular with investors when the next bear market arrives.

Both approaches have their merits.

As DC joining procedures become slicker and more automated, the need to help members make investment choices grows.

As part of this, schemes will need to make sure their default funds are up to scratch.

So with new approaches on the horizon, the days of the lifestyle switching could be running out.