Marvin OnumonuYoung men are more likely to know their pension is invested compared to women and older savers, research carried out by Opinium for Hargreaves Lansdown found.
Of those surveyed, 51% of men knew their pension was invested, while only 28% of women said the same.
Men aged 18 to 24 had the highest awareness at 60%.
For women, the highest awareness was among those aged 45 to 54 at 33%.
Just over half of men aged 55 to 64, and 30% of women in the same age group, knew their pension was invested.
Clare Stinton, head of workplace saving analysis at Hargreaves Lansdown, said: “Pensions are often our first investment, but a worrying number of people are completely in the dark about it.
“Overall, only 40% know their pension is invested, falling to 28% of women (compared to 51% of men).
“It’s a gap that needs to be addressed both overall and across genders if people are to get the most from their retirement planning.”
Stinton added: Helping people get to grips with these issues has the potential to reshape financial futures.
“The two biggest drivers of your final pension pot value are how much you pay in, and the investment return you get.
“Both of these are within the member’s control. Starting early and understanding the power of compounding can do a lot of the hard work for you.
“For women in particular, turning their attention to their pension investments could bring them one step closer to bridging the gender pension gap, which on average sees them retire with significantly less than men.”
She said: “The work around the advice guidance barrier, which will enable providers to offer more personalised recommendations around products, could have a real impact on boosting knowledge and prompting people to take action.
“It could be particularly transformative for the retirement fortunes of women.
“It’s also important to look at the retirement fortunes of older generations, as there is still a great deal of work to be done to address the challenges they face.”
She added: “Just 52% of men and 30% of women aged 55-64 know their pension is invested.
“This is worrying, not only because they risk sleepwalking into having a much lower retirement pot than they otherwise could have had, but also because how their pension is invested may not link up to how they want to take an income in retirement.
“Most workplace schemes will lifestyle pensions – automatically shifting pension investments into lower-risk assets like bonds as retirement nears, with the aim of sheltering the pot from market movement and stabilising its value.
“This approach can work well if someone is planning to buy an annuity, but this won’t be everyone.”
She said: “For those opting to use drawdown, keeping a portion of their pension in shares could actually help grow their pot, even after they start withdrawing from it.
“Too many people are reaching retirement without a clear plan. It’s like cruising through a long-haul flight on autopilot, only to step into the cockpit for the very first time to land the plane.
“Without guidance or advice, it’s a risky time to go it alone. It’s vital those approaching retirement access all the support they need.
“This could be through guidance services like Pension Wise or going down the financial advice route. Under targeted support, providers will also be able to play a bigger role in helping people make more informed decisions.”
