As the world celebrates International Women’s Day and all that women have achieved, it’s a good opportunity to take stock. Women have undoubtedly come a long way in terms of workplace participation, equal pay and financial independence, but there is still some way to go. 

These days, women make up almost half the workforce although 43 per cent work part-time. Women also make up over half of university enrolments (58.4%), but on graduation they earn $5,000 less than similarly qualified men.i

By the time retirement comes around, women face a triple whammy. Not only are women likely to earn less than men and take time out of the workforce to care for children, they can also expect to live longer than men, so their retirement savings need to stretch further.

Watch the gap

The upshot is that women currently retire with an average superannuation balance of $213,140, compared with $292,000 for men. One in four women retire with no super at all and more than 80 per cent retire with inadequate savings to fund a comfortable lifestyle. ii

According to the Association of Superannuation Funds of Australia (ASFA), single retirees need an annual income of $43,787 to live comfortably, while couples need $61,786. This is considerably more than the Age Pension, which currently pays around $24,000 a year for singles and $36,000 for couples.

So how can women close the gap?

Practice money mindfulness

The single most important thing women, or men for that matter, can do to improve their financial wellbeing is to pay attention. Look online or for books about personal finance, investing and super. Also understand what your employer should be contributing to your super and how your money is invested.

People who have limited experience with investing often feel too embarrassed to ask questions, but there is no such thing as a stupid question. So talk to us about strategies such as the following to help you get ahead.

Start building your nest egg early

Even small amounts saved early in your working life can make a big difference in the long run, thanks to the magic of compound interest. When your budget allows or you receive a windfall, put some savings to work in super.

This is even more important if you are planning to take time out of the workforce to have children, study or travel. While you are working full time and have disposable income, consider making voluntary tax-deductible contributions up to $25,000 a year (including your employer’s Super Guarantee payments). You can also make after-tax contributions of up to $100,000 a year.

Individuals returning to the workforce after a break may also be able to make catch-up super contributions. If eligible, you could carry forward unused amounts of your annual $25,000 tax-deductible limit for up to five years.

A sacrifice that pays

If your salary and financial goals permit, you could talk to your employer about directing some of your pre-tax salary into super. These ‘salary sacrifice’ contributions are taxed at the concessional superannuation rate of 15 per cent instead of your marginal tax rate (30 per cent if you earn more than $250,000). Earnings on your savings inside super are taxed at 15 per cent, but remember to keep an eye on your $25,000 contribution cap which includes your employer’s Super Guarantee payments.

Work as a team

If you are on a low income or not working, perhaps your partner could give your super a boost. If your income is $37,000 or less, your other half may be eligible to contribute up to $3,000 to your super and receive an 18 per cent tax offset of up to $540. The offset gradually reduces and phases out completely once your income reaches $40,000.iii

Choose your super with care

It’s generally preferable to have just one super fund because multiple accounts can be difficult to keep track of and cost you unnecessary fees. So consider consolidating your super accounts after researching the market to see which fund, and which investment mix, best suits your needs.

There’s no doubt that women have some extra challenges when it comes to building retirement savings. If you would like to discuss ways to create a financially secure future, speak with the Centaur Financial team about what more you can do.

i Women in super,

ii ASFA,



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