The Federal Government has been called on to address the current inequality that exists for women in superannuation.
By the time they are 85 women make up 66% of the population, but are 2.5 times more likely than men to live in poverty in retirement, according to ABS reports.
Accounting and advisory firm William Buck suggested a number of initiatives, such as providing a woman’s partner with the ability to make tax-deductible contributions to the superannuation account of their wife or partner while they are on maternity leave, and providing women returning to the workforce with higher tax-deductible contribution limits to recover the ground they’ve lost.
Co-founder of Aspire Retire, Olivia Maragna is a strong advocator of women in super, and says she would love to see a family contributions cap, or the ability to carry forward unused contributions caps.
When asked how the Opposition would address this issue, Senator Mathias Cormann did not agree to implement the suggestions, but said that their Paid Parental Leave scheme will pay superannuation benefits to help women’s superannuation balances while they take time out of the workforce to care for their newborns.
“Higher contribution caps allow women to catch up by contributing more to their superannuation when they are able and more generous co-contribution benefits for lower income earners are particularly beneficial for women,” said Cormann.
The problem is not only around women taking time off for children, says Maragna. “There are a lot of women out there who do run their own small business, and around about half of those aren’t contributing money into super full stop. That’s a big thing.”
She says everyone can do their part to address the issue, and there are a number of things that advisers need to think about, including different priorities that women have.
“Advisers play a role in educating their clients around what they can be doing prior to having kids and taking time off work. There needs to be more advocation around some of these incentives that the Government does give you, around basic financial strategies.”
Average super payout for women is 43% less than male counterpart
Women’s top priorities in advisers are rapport, recommendation or trusted service, and recognised qualifications. Men look for investment expertise, independence, and business reputation
Women prioritise spending quality time with family and being a good parent above being financially prepared