This is a significant lift since April 2015, rising from 16 per cent and is now almost double the UK average of 12 per cent, according to new research from Aegon UK.
The seven per cent increase in people on track means that since the introduction of the pension freedoms a year ago, nearly 105,000 more IT workers are on track for the retirement they want, suggesting that the pension freedoms and initiatives like workplace auto-enrolment for employees are having the impact the government intended. In fact 28 per cent of IT professionals are saving more into their retirement pot as a direct result of the pension freedoms alone.
These are encouraging signs for pension savers in the IT sector, who contribute on average £357 to their pension a month, £147 more than the average across all professions and the third highest contribution level of all professions in the survey, only behind insurance and pension professionals (£592) and banking, financial management and accountancy workers (£443).
Workers in this sector are also far more engaged with their pension savings compared to the UK average. More than a third (37 per cent) have checked the performance of their retirement savings within the last six months, while a similar number (34 per cent) have taken steps to review their plans for retirement. This is up on the UK average of 24 and 22 per cent respectively.
These factors have all contributed to the IT sector having the second highest average readiness score, of 60, just behind the scientific services sector (61).
Steven Cameron, pensions director at Aegon UK, commented, ‘IT professionals are leading by example, with nearly a quarter of them (23 per cent) now on track for the retirement they want. Across the sector, this means nearly 105,000 more people have improved their saving behaviour, or changed their aspirations for retirement.
‘As we enter an era of personal responsibility for retirement saving, it’s clear that the pensions penny is really starting to drop for those working in this sector. Auto-enrolment for employees, and the pension freedoms have clearly played their part in getting workers in this sector better prepared for retirement then they ever have been.
‘However, IT professionals still have a long way to go, 77 per cent of them are still falling short of their retirement targets. For a start, they need to become far more realistic about their income ambitions in retirement. Currently they are reaching for the stars and expecting to take more in retirement than they currently do in their careers. Based on their retirement income expectations they would need a pension pot of more than the £1m lifetime allowance. These figures show there’s still a job to be done in helping even the most engaged professions set realistic retirement income expectations and then act to deliver on these.’