Gender disaster: women retiring with 40% less

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Women are being left out in the cold with 40% less to retire on than their male counterparts, partly due to a lack of access to quality advice.

Ahead of tomorrow’s international women’s day, MLC has raised the issue to generate awareness about the importance of superannuation and the amount of saving women will need in retirement.

Financial advisers have an opportunity to change these statistics, spokeswoman Lara Bourguignon told Wealth Professional.

“It’s an enormous opportunity for advisers to build trust about something that’s a huge asset,” she said. “It’s about being flexible, so potentially being available on a lunch break or after work, and it’s about initiating the conversation in a way that’s not overwhelming.”

The huge superannuation disparity is caused in part by women taking more time out from work than men to raise children or to look after elderly parents, but gender-based salary inequalities still have a lot to answer for, Bourguignon said.

“We see fabulous gender equality around our graduates and middle management, but there’s a drop-off we haven’t quite cracked at senior management level.”

The consequences of the superannuation disparity, hand-in-hand with the fact that women are outliving men, mean that quite simply many are not going to have enough money to retire with.

“Really what we want to do is generate a call to action. Financial information can be overwhelming, especially if you have children to look after, but we have free phone-based advice and access to holistic advice,” said Bourguignon.

The Association of Financial Advisers’ Inspire initiative (AFA inspire) is also throwing support behind the issue in order to encourage women in the wider community to seek financial advice for a more secure future.

Chair Deborah Kent is encouraging women to review their plans for retirement now, even if it is still many years ahead.

“We have seen female financial advisers, like those on the AFA inspire committee, who have shown tremendous leadership in developing their financial advice offerings,” she said.

These comments, and international women’s day, come just a week after the death of the ‘first lady of Australian financial planning’, Gwen Fletcher, who inspired many and was widely recognised as one of the pioneers of financial planning in Australia.

Fletcher died peacefully last Friday at the age of 94.

SEE MORE:

‘Gorgeous’ pioneer of financial planning dies

Women more worried at retirement shortfall

Gender disparity 'alarming', says planner



 
  • Mark Thompson on 7/03/2014 10:19:32 AM

    To say women retire with less is too broad a statement for women who are married or partnered (~50% of women). It's like saying women retire with less equity in the family home. Yes, my spouse brought up 3 kids and has less in her super account than mine, but in reality we share each others super accounts, cash and other equities. If we split up she automatically gets half of everything and maybe more if a court so determined. Where the problem lies is for single women who have been paid less for doing the same paid employment as men and who have less than they should in super, or women who have brought up kids without support and where the courts have not enforced the legal requirements of their ex spouses to pay their fair share.

  • SB on 7/03/2014 11:32:58 AM

    I agree with Mark. For those who are coupled, it would be the partnership that retires with less income and that is simply a lifestyle a choice. You either sacrifice some of your childrens growing up by working, or you sacrifice your retirement income.
    I think a bigger problem is coming from marriage breakdowns where both partners are then missing out and the contributions caps do not effectively allow for a rebuilding of wealth. Or the ability to "catch up" once kids go back to school. To presume that retirement savings are not shared with the spouse is a little sad.

  • SS on 7/03/2014 11:52:59 AM

    Correct Mark. In my experience, women are far more likely to seek and accept advice- my single female clients outnumber my single male clients almost 4 to 1. (I should be marketing my client functions to single males!) Its primarily about pay rates (particularly in the past) and time out of workforce while having kids.

  • Mark Thompson on 7/03/2014 1:12:40 PM

    Hey, while I'm on a gripe, and following on SB's comments, where is the fairness when a double income couple with no kids, squirrels away super and savings, while my family survives on one income and educating 3 kids (ever had to fork out for basketball boots, every 1/season?). The same childless couple then enjoys the services that my now adult children provide to the community with Health Services, Fire and Safety and Education. Now in my golden years, I'm reduced to a $35K cap on concessional contributions into super. Where is the fairness in this. Again, from the female perspective my wife is disadvantaged again.

    How about the 10% Super Concessional Contribution Rule introduced with SGC to give Industry Super a leg up. Before Xmas I spoke with a lady who is single, nudging 50 and underdone in her super. She would like to Salary Sacrifice because she is way below the $25K cap, but her employer will not do it for her and nor are they obliged to. Changing jobs is out. How simple would it be for this lady to top up her SGC with her own concessional contributions, but no the 10% rule stops her.

  • Adviser B on 7/03/2014 2:06:04 PM

    By including women who are partnered and sharing equally both super accounts, the statistics are totally skewed. Yes, men would still have higher super due to higher pay, longer working life etc, but not to the point that the 'stats' are showing. By including shared values but only focusing on the woman's account is very inaccurate, but obviously done to make the figure greater and more alarming/ headline grabbing. A worthy cause I guess, but there are ways to promote it without deliberate misrepresentation of the figures.

WP forum is the place for positive industry interaction and welcomes your professional and informed opinion.

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