A number of professional associations, including the Association of Superannuation Funds of Australia (ASFA) and the Association of Financial Advisers (AFA), have recommended that action is required by Government, Employers and the Individual to address gender disparity within superannuation.
Whilst data from the Australian Bureau of Statistics has shown an increase in the average super balances of both men and women over the recent years, women are still lagging significantly behind with an average super balance of $54,916 for 2013-2014 compared to $98,535 for men.
The main reasons for this disparity are:
(a) Lower average wages for women (approximately 18% less than men's full-time average weekly earnings), and
(b) Broken work patterns (eg. time off to raise children or look after loved ones).
According to the AFA, wholesale reforms are required to address this disparity and related issues to ensure greater economic security for women in retirement. Their recommendations include:
(a) Access to affordable quality childcare out of school hours,
(b) Removal of monthly $450 threshold for superannuation guarantee contributions (SCG), and
(c) Lifetime superannuation contribution caps for low-income earners and those who have taken career breaks.
What can you do in the meantime to improve your retirement savings?
1. Discuss with your employer about flexible work arrangements – be it working part-time and/or from home.
2. Where on a break and not generating income or sufficient income to quality for SCG, if your circumstances and legislation permits, make voluntary superannuation contributions.
3. Be informed – as AFA State Director for Queensland Dianne Charman said, "financial literacy creates financial wellbeing … if we can teach people how things work and effectively give them a sense of control, it would have a huge impact in empowering individuals".
Contact the Head of our Wealth Management division, Manish Sundarjee, on +61 3 9836 2900 or at email@example.com should you have any queries or concerns, and would like more information on how you can become empowered to improve your own financial wellbeing.