The asset manager said people planning their retirement were confused about how best to access their pension savings, how much income they would need in retirement and how long their money would last.
It found many considered planning for retirement among the hardest decisions in life, harder than naming a child or buying a house, and believed their savings might not last them throughout retirement.
The firm polled 838 adults aged 55 or above in February 2018 and found while people were comfortable thinking about when they might retire and how long they might live, they found it difficult to assess their retirement income needs.
Looking at the successful implementation of auto-enrolment for pension savers Columbia Threadneedle said a similar system could be introduced at the back end of pension saving.
It called for people to be defaulted into a regulated retirement investment solution such as income drawdown.
Chris Wagstaff, head of pensions and investment education at Columbia Threadneedle Investments, said: "People are effectively being asked to make one of the biggest financial decisions of their lives at a time when financial literacy is starting to decline and gut feel takes over.
"There have been a few barriers to innovation in the post-retirement space due to the pace of policy change, uncertainty about how the market will develop and the fact that most defined contribution pension pots are relatively small. But we can’t afford to wait.
"Auto-enrolment for working people has been heralded as a great success so far. The same principles should be applied to those at the point of retirement, who could be automatically enrolled into a regulated income drawdown fund with a preset investment strategy and income withdrawal rates."
Threadneedle found 58 per cent of babyboomers had retired or expected to retire between the ages of 60 to 69 and 76 per cent expected their retirement to last for 20 years or longer.
Almost a third (28 per cent) said they did not know whether their pensions savings would last for the full term of their retirement, while a further 30 per cent believed their savings would last them for 20 years or less.
For half of the people polled the most important consideration was securing a standard of living in retirement equivalent to that enjoyed pre-retirement and about 75 per cent thought an annual gross income below £25,000 would provide a “comfortable” retirement.
While the largest sample of people relied on their defined benefit pension schemes (38 per cent), for 31 per cent the new full state pension of currently £159.55 per week represented their most significant source of income.
A mere 18 per cent said they relied on their defined contribution (DC) workplace savings and/or self-invested personal pension (Sipp).
Mr Wagstaff said: "An increasing number of people are opting for income drawdown over annuities, but they must somehow navigate their way around the longevity and inflation risks that come with income drawdown. If not managed well, these risks can add up to an uncomfortable retirement at best, or worse, lead to people outliving their savings.
"The managers of [the proposed default] funds would determine the combination of default investment strategy and longevity insurance that would provide people with a sustainable, guaranteed minimum income throughout retirement, all within a regulated charging structure."
Dave Penny, managing director of Invest Southwest, agreed something needed to be done to focus on solutions for those about to retire but he called the proposal a "basket full of snakes".
He said: "I am envisaging a client who has had their pension funds lifestyled into very low-risk funds automatically, then suddenly being put into a new product with investment risk.
"Conversely I am looking at somebody with an adventurous attitude to investment being automatically put into something with low risk. And any combination in between.
"I can't see it ending well with a client being automatically placed into any kind of regulated product without having a choice."
He said more resource needed to be available to those people in various forms, including advice.
Columbia Threadneedle found 17 per cent of the people it polled did not trust the pensions or investment industry, and 14 per cent were not prepared to pay for financial advice.
More than half (53 per cent) believed being automatically enrolled into a default income drawdown fund would simplify the decision-making process.
Robert Forbes, chartered financial planner at Stadden Forbes, said: "The real issue with drawdown is underestimating longevity.
"Clearly the money has to last, the issue is that people don’t know how long they are going to live, what investment returns are likely to be, and crucially the order of those investment returns particularly in early retirement. The maths is straightforward but the unknowns are huge.
"If there are advisory services that provide valuable lifetime modelling then that very cost is what could save retirees from withdrawing money too quickly and facing financial disaster."
Columbia Threadneedle also found one in every five baby boomers (19 per cent) was unaware of the pension freedoms introduced in April 2015.
carmen.reichman@ft.com
