Are you super ready for retirement?

It is a well-known fact that most women retire with less in superannuation than men. In fact, figures suggest it may be as much a half. According to the Hilda survey 2017, the average superannuation balance women retire with is $230,907. Other sources put this figure at considerably less. While the Association of Superannuation Funds of Australia (ASFA) Super Guru site states one in three women retire with no superannuation at all.
The reasons why are generally because:

  1. Women often earn less than men. The gender pay gap currently sits at a record high of 18.8% according to data released by the Australian Bureau of Statistics.
  2. Interruptions usually occur in a woman’s career by having children and raising a family.
  3. As a result, women are also more likely to return to work on a part-time basis.

Having $230,907 in the kitty might sound like a decent amount of money but maybe not from a retirement perspective. ASFA currently estimates that in order for a single female around 65 years of age to live a comfortable lifestyle, their annual income needs to be $43,695. This is with the assumption that they own their own home.

What can you do?

That is a little confronting, so what can you do?

  1. Consolidate and keep track of your super.
  2. Check statements and make sure employer super contributions are getting paid.
  3. Start thinking about super early, even in your 20’s. Make non-concessional contributions, even just an extra 1% for your entire working life. If you earn between $36,813 and under $51,813 in the 2017/18 year the government will match your contributions up to $500.
  4. Spouse contributions. If a spouse has an income of $37,000 or less, a tax offset of up to $540 can be claimed for contributions made on their behalf to the super fund.

There are many reasons why women have smaller balances and additional strategies that can be implemented. If you would like to know more about what you can do in your situation, make a time to come in and have the conversation.

DISCLAIMER: The information provided is of a general nature only and not intended as specific financial advice. It does not take into consideration any pensions and additional income by the individual or returns, fees and charges incurred by the super fund. It also does not take into account the general health and lifestyle choices of specific individuals.