We’ve started to lift the bar for women’s super

Research by the Association of Superannuation Funds of Australia (ASFA) shows the $2.3 trillion superannuation system is delivering bigger superannuation balances across the community and lifting living standards for retirees.

Importantly, the research reveals that women are starting to share in a bigger slice of the superannuation pie holding 38.7% of total super account balances in 2015/16 compared with 23% two years earlier.

Super is founded on compulsory employer contributions directly linked to working patterns. As such, career breaks, part-time work and the gender gap in wages has resulted in women, on average, ending up with less super savings in retirement than men. An average super balance for women of 61% of that for men is an improvement on the 56% from two years earlier, but it is still a significant disparity that needs to be addressed to realise greater social equality.

How do Mercy Super members fare?

The release of the ASFA research prompted us to explore the gender savings gap for our members and whether there has been any improvement over recent years. With one of the highest levels of women membership in Australia, many of whom work in part-time or casual employment, this is a core issue for our members.

We were pleased to find that the gender disparity in super account balances for our members is far less than in the general community. Importantly, we have seen a significant improvement in the ratio of women/men average balances across the age groups where changing work patterns tend to have the highest impact.

The chart opposite shows the average balance of women compared to men for Mercy Super’s members at the end of September 2017 (green line) and September 2015 (orange line). As an example, the average account balance of women aged from 45 to 49 was 69% of the average for our male members in 2015 and 81% in 2017.

These results are especially encouraging at the mid to late-career stage which can be a challenging time for women. At ages 45 to 59, Mercy Super female members have significantly improved their position compared to male members. The female to male average account balance ratio in these age groups is also well ahead of the general community as revealed through the ASFA research.

The improvement at ages 45 to 59 can also be seen in this chart which shows the change in average account balances for our female and male members from 2015 to 2017.

What can be done to close the gap even further?

There’s plenty that can be done to get more out of your super savings. While the sooner the better, it’s never too late to take action to achieve the best retirement outcome for you. These simple steps don’t involve an onerous effort or cost:

• Take an interest – find out what your balance is, do you have any other super accounts out there, and have a play with our retirement planner to see how your super is looking at different retirement ages, investment strategies and levels of income in retirement.
• Check your investment strategy. You’ll be surprised at the difference choosing an investment strategy that better suits your retirement aspirations and timeframe can have on your end balance.

Next, consider:

• Adding a little extra to your super from your regular salary – and consider salary sacrificing to take advantage of the tax benefits. It doesn’t take much to make a big difference to your super and offset the impact of any career breaks.
• If you have a partner or spouse, building your super together to achieve the best outcome as a couple.

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