64% of tech professionals rely on workplace pension for life after jobs01 July 2015 Back to results
- IT workers have the greatest annual income expectations in retirement
- They’re largely dependent on their workplace pension for this, with two thirds (64%) seeing it as their main source of retirement saving
- Yet a quarter (25%) don’t even know how much of their salary they’re contributing to their company pension
Aegon UK’s third Readiness report investigates how ready people working in a range of professions are for the retirement they want.
Importance of workplace pension
Company pensions play a major role in retirement provisions for IT professionals, with almost two thirds (64%) of workers saying it’s their main method of retirement saving. They come just behind financial (69%) and healthcare workers (67%).
IT professionals are also among the most engaged with their workplace pensions, with nearly one in three (29%) reviewing their retirement plans in the last six months. In contrast, only one in ten (12%) administrative workers had done this.
Those working in the IT sector have the most ambitious expectations, aiming to receive £50,000 per year, but this is desperately out of reach of the £25,000 they are on course to receive annually and 24% higher than the sectors average salary of £38,000.
However, a quarter (25%) of IT professionals claim to have no idea how much of their salary they’re contributing to their company pension. Additionally, two in five (43%) do not know how much their employer is contributing to their pension either. This lack of awareness could have implications for their retirement expectations.
On a positive note, a third (32%) of people who work in the IT sector said that they would be willing to increase their pension contributions beyond the new auto enrolment minimum contribution of 5% due to be enforced from 2018.
By 2018 the state pension age will be 65 for both men and women. According to Aegon’s survey, IT professionals expect to retire at 63, five years ahead of the state pension age for today’s thirty year olds.
Angela Seymour Jackson, Managing Director Workplace Pensions, Aegon UK said: “It’s encouraging to see IT professionals having relatively good engagement with their pensions compared to other professions. However, the expectations they have for their retirement age and annual retirement income appear at odds with reality. To avoid shock in retirement, workers in this industry either need to begin increasing their contributions or reign in their ambitions about their retirement expectations. There needs to be more attention put on giving people access to view and manage their workplace retirement savings online or on their mobile. Employers are well placed to support people get ready for retirement and our new service Retiready, provides a digital interface that employers can use to give their pension.”
How other professions stack up
Monthly retirement savings by profession
£234 Banking & financial
£74 Creative arts & design
£95 Social care & guidance
Pension pots by profession
£43k Engineering, manufacturing & production
£40k Banking & financial
£38k construction & property
|Profession||Average Readiness Score|
|Advertising, marketing and PR||49%|
|Animal and plant resources||50%|
|Banking, financial management and accountancy||54%|
|Charity and voluntary work||50%|
|Construction and property||48%|
|Creative arts and design||49%|
|Engineering, manufacturing and production||54%|
|Hospitality and events management||47%|
|Human resources and employment||49%|
|I am unemployed||38%|
|Profession||Average Readiness Score|
|Insurance and pensions||56%|
|Law enforcement and protection||54%|
|Leisure, sport and tourism||50%|
|Management and statistics||57%|
|Media and broadcasting||41%|
|Mining and land surveying||57%|
|Publishing and journalism||47%|
|Retailing, buying and selling||48%|
|Social care and guidance work||49%|
|Transport, logistics and distribution||52%|