Confirmation of what we’ve always known – women are at a significant disadvantage when it comes to saving for their later years.
A study by consultancy group Rice Warner (commissioned by not-for-profit organisation Women in Super) has revealed that retirement savings for men aged between 30 and 60 are 42 per cent higher than for women of the same age.
The gender gap was biggest for women in their late 30s and mid-40s.
And with women historically earning less than men, retiring earlier and living an average of three years longer, that also means we have to stretch out retirement savings for longer.
It make sense. Women take more time off work for child care than men, creating less opportunities for career progression and promotion – and therefore less income.
So, what can we do to fix the problem?
Rice Warner gives these suggestions to help women and their employers close the gap:
- Use the Low Income Superannuation Tax Offset (LISTO) to give low-balance members up to $500 in government contributions.
- Use the government superannuation co-contribution to make available $500 per year to match contributions for low- to medium-income members who make personal contributions.
- Employers could pay SG contributions into superannuation for women on maternity leave to reduce the impact of their time off work.
- Employers could pay higher SG contributions to female employees to draw attention to the super gender gap – and show that they are prepared to help to close it.
Time to schedule a meeting with the boss?
Pictured: Graph charting the average balance of superannuation accounts owned by women relative to the balances of their male counterparts as at 30 June 2017. Image courtesy of Rice Warner.
