For many people, the money held in a pension is the only exposure they have to the ups and downs of financial markets.
Unlike those investing under their own steam - via an ISA or SIPP that they have set up, for example - those with only workplace pension investments may be unfamiliar with the feeling of watching their money fluctuate in value.
The wild movements in markets this year will have been unsettling for pension investors, and this appears to be borne out in results from recent research by Fidelity into attitudes to retirement saving.
Conducted after the initial big Covid-19-related falls earlier this year, the research asked pension savers about how confident they felt that they would secure a comfortable retirement. More than half - 51% - said their savings won’t meet their needs in retirement, with 48% saying they have experienced a drop in the value of their retirement savings following the pandemic.
Less than a third - 29% - believe they’ll have sufficient income to cover their retirement, and three-quarters are now considering other means of filling this retirement gap.
The picture that emerges is of a great pensions blackhole, which is being made worse by market falls that put a comfortable retirement even further out of reach.
But rather than being a cause of gloom, the results should be a prompt to take action. At whatever point in your working life you are, it is possible to dramatically improve your retirement prospects.
For younger people, those still with many years or decades until they retire, market movements as we have seen this year should be viewed pragmatically. Volatility may be uncomfortable at times but falls in prices mean that the contributions you make buy assets at lower prices and give those assets more room to grow into.
Markets will rise and fall as the years pass so you need to invest through the lean times in order to take advantage of the good times. The worst course you could have taken after the recent market fall would’ve been to sell out or cease contributions - by doing that you get all of the pain but none of the gain.
For those a little close to retirement, there is naturally less time in which to let asset price falls recover but there is still time to up contributions and ensure pension investments are diversified so that future periods of volatility are smoothed out.
Fidelity’s research also asked people how they planned to fund their retirement, other than through pension savings. That could mean inherited money, continuing work, rental income from a property or simply from the wealth of a spouse or partner.
Among those planning to retire within the next five years, almost half - 49% - said they planned on working part-time. Some 23% said they would be able to receive rental income from property and 18% said they would use inheritance. Just 13% said they were unsure how they generate retirement income, although this jumped to 25% when younger workers were included.
This spread of different sources of retirement income illustrates the reality for retirement now and in the future. It is likely to come from multiple sources, with one single source unlikely to provide all you need.
This is an important point to grasp about your own retirement planning - especially if you are worried that you will not meet your targets. Those behind on their pension saving can feel overwhelmed by the size of the task ahead of them. Building a retirement fund that can maintain your lifestyle in retirement is no mean feat even if you start at a young age, but starting later means the contributions you need to make can seem impossible.
But saving more - although vital - is only one lever you can pull to improve your chances - there are others as well. By mapping out what your retirement will look like, including the things you want to spend on and those you are happy to do without, you might find that you can live surprisingly cheaply. Working longer is no one’s idea of fun but if work is part-time and can fit around your retired life, it can actually be a great source of social contact and mental engagement, as well as being a source of income.
Planning for retirement is the subject of our Retirement Savings Guidelines which lay out how you can build your own retirement targets and a plan to meet them, even if you are making a late start.
Important information: The value of investments and the income from them, can go down as well as up, so you may get back less than you invest. Investors should note that the views expressed may no longer be current and may have already been acted upon. Tax treatment on ISAs and SIPPs depends on individual circumstances and all tax rules may change in the future. Withdrawals from a pension product will not be possible until you reach age 55. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.