Investing in your family is always a good thing however research consistently shows that women are more likely to take time out of paid work to care for children. This leads to a short fall when it comes to retirement savings. The latest research from ASFA shows a 25% difference, with the median balance for those aged 60 to 64 at $211, 996 for men and $158, 806 for women.
Women are also more likely to work part time or casually and represent only 42% of full-time workforce in Australia. Additionally the gender pay gap means that women earn 22.8% less than men and are generally under-represented in management.(1) If you are a woman reading this, we feel your frustration.
In good news, the Australian government announced, alongside the release of the Working for Women strategy, that from 1 July 2025 it will pay superannuation on government-funded Paid Parental Leave (PPL) which will be administered by the ATO. This measure is yet to be legislated.
How can women boost their retirement savings?
- Consider using the spouse contribution while on maternity leave – your partner may be able to claim a tax off-set while your income is low
- Ramp up your saving when you return to work by salary sacrificing – even small amounts can make a difference in the long term
- Consolidate your super – multiple super accounts can incur unnecessary extra fees
- Consider risk in your investments – a good benchmark for your tolerance for risk is your ability to sleep soundly at night. It’s important to talk to a qualified and trusted financial advisor if you are unsure about how to work out risk appetite.
Seek advice
Each family situation is unique. Make a time with us to discuss your retirement goals. We will help you formulate a strategy to get there.
(1) https://www.wgea.gov.au/sites/default/files/documents/WGEA-Gender-Equality-Scorecard-2022.pdf
General Advice Warning: The information provided in this article is general in nature and does not consider your particular investment objectives, financial situation or insurance needs; we therefore recommend you seek advice tailored to your individual circumstances before making any specific decisions.
Dobbrick Financial Services (Gympie) Pty Ltd ABN 48 931 205 109 & DFS Oakland ABN 64 340 527 395 and their advisers are authorised representatives of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306. DFS (Ipswich) Pty Ltd ABN 86 100 184 521 and their advisers are authorised representatives of Fortnum Private Wealth LTD ABN 54139889535 AFSL 357306.
