Women’s Super is not so Super

A December 2015 report from the Association of Superannuation Funds of Australia (ASFA) showed the average superannuation balance for males was around $135,000 and $83,000 for females. Average balances around retirement age (60 to 64) were $292,500 for men and $138,150 for women. According to the survey, women are 2.5 times more likely to spend their retirement in poverty.

It’s a function of the broader pay gap between men and women in our society.  Despite all the talk of gender equality, women remain far more likely to take time away from work to raise children.  When they return to the workforce, they are more likely to return in a part-time capacity, or in lesser paid jobs. 

In the meantime, many men are working full-time, climbing the career ladder and building up their super.  It might be fine if every couple was caring and sharing, with their assets pooled upon retirement. But unfortunately about one in three Australian marriages end in divorce, with the statistics for de facto relationships even worse. 

From a personal finance point of view, it doesn’t pay to look after the kids and run the home. It’s an inequality the government should look at, but unfair as it may be, if you’re a woman who isn’t accumulating enough super to fund a comfortable retirement, then the onus remains on you. 

Fortunately there are things you can do. Investing in property is one of them. Take the example of Debbie who wants her retirement to be debt free, while having enough money to continue to travel overseas, especially to Morocco and to continue her exploration of Italy.

Debbie’s not thinking of bingo, bowls and a recliner chair. In addition to travel she intends to remain engaged in life and socialise with friends and family, dine out once a week, stay fit and healthy, volunteer and take up some new hobbies.

Recently Debbie realised that if she did nothing she wasn’t going to have enough superannuation to afford this lifestyle. She took action. Earlier this year, she bought a $400,000 house and land package in Wollert, Victoria. By the time she is ready to retire in ten years time, it is estimated (based on very conservative assumptions) that she will have over $300,000 in equity to add to her retirement nest egg.  That’s nearly half the money she needs to fund the kind of retirement lifestyle she’d like. 

If you’ve done the hard yards bringing up the kids but are looking down the barrel of a retirement lifestyle that’s less than you deserve, why not come and talk to Pfeiffer Property about improving your financial future today.