Many women are financially disadvantaged in the workplace because they are paid less than men, which means their retirement funds are also much less, but there are ways to reduce the gender gap.
According to the Australian Taxation Office (ATO), for Australians aged 55-59, men have an average of $51,000 more saved than their female colleagues.
That’s the equivalent of more than 3 1/2 years of contributions for workers earning a median national salary of $70,000 per year.
UniSuper select advisory manager Renae Anderson said the figure was improving over time, but was not yet where it needed to be.
“This problem stems from the fact that women’s work pattern is slightly different,” she told NCA NewsWire.
“Usually we have taken time out of the workforce to raise family or to take care of family. We often return to the workforce in a part-time capacity and often have the lowest paying jobs in the community.
“So it’s all these things that have contributed to the problem.”
Ms. Anderson said that there were four key ways for women to increase their retirement savings.
Ms. Anderson said that women should check whether spousal contributions were relevant to them.
“In general, for women earning less than $37,000 per year, their spouse could generally contribute $3,000 each year to their pension and receive a $540 tax refund,” she said.
“So this helps to top up your groceries while also providing a tax benefit to your spouse.”
If you’ve had time off work to have a baby or for some other reason, Ms. Anderson recommends considering catch-up contributions.
“If you have a total super balance of less than $500,000, and you haven’t used all of your concessional contribution limit of up to $27,500 in prior years, you could make additional contributions,” he said.
“So this could have a significant impact on your super balance, and anyone with a tax rate above 15 percent could save a considerable amount on taxes as well.”
CHECK YOUR FEES
Being in a low-cost fund saves everyone thousands of dollars at retirement, according to Ms. Anderson.
ATO’s MySuper Comparison site is a great place to start to find the best deal to suit your needs.
INVEST IN YOUR SUPERANNUATION
Ms. Anderson advises that the sooner you start investing in your supermarket, the sooner your money starts working for you.
“No matter where you are in your career… time is your superpower thanks to compound interest,” he said.
“Between the ages of 35 and 39, there’s already a gap of about $15,000 in groceries, so the sooner you start looking at these things, the better.”