A biennial OECD report on retirement plans recommended an automatic switch within the plan to less risky investments as people near retirement.
Governments should at least encourage people to choose (lifecycle funds), but it may be necessary to go further and make them a default option, the report said.
The report noted that workers near retirement age faced the toughest prospects, and U.S. workers in that category could have benefited from having less risk in their portfolios over the past year.
Almost 45% of Americans ages 55 to 65 held more than 70% of their private retirement assets in equities, only slightly down from the 50% for those under 55.
The Organization for Economic Co-operation and Development noted that English-speaking OECD countries, where more than half of retirement assets were invested in equities, saw far steeper declines in their retirement assets in 2008 than countries with smaller allocations to equities.
For example, the report showed Ireland with the biggest drop of 37.5%, followed by Australia, down 26.7%, and the U.S., off 26.2%.
Mexico, meanwhile, with only around 10% of retirement assets in stocks, slipped only 5.2%, while Germany, with about 30% in equities, declined by 8.5%.