Women and Super – it’s time to plan ahead

 

In this Spotlight on Wealth by Shadforth Financial Group we focus on superannuation. Read the somewhat sobering numbers and be motivated by the simple steps you can take now to make your superannuation nest egg just that much bigger when retirement comes.

 

 

Gender equality is enshrined in Australian law, however one area where women are striving to make up ground is their ability to save for retirement. At around $157,050 the average super balance for women at retirement is roughly 40% of the amount for men.

 

There are several reasons for this, including the gender pay gap and the tendency for women to take time out of the workforce to raise a family. And when women do return to work its often on a part-time basis. However, blessed with longer lives (around three years on average for those that reach 65) many women also face the extra financial burden of needing greater levels of savings to cover those extra years in retirement.

 

YOUR MONEY MINDSET

With those statistics in mind, looking after yourself financially for the long term becomes as critically important as looking after your physical health through diet and exercise. Research suggests eight out of ten women will be responsible for their own financial security at some point in their lives. Seeking the right information and support can be an important part of managing your money to improve your financial wellbeing.

 

THE SAVINGS GAP: How much super do women have compared to men?

 

 

CLOSING THE GAP

Despite many women taking positive steps to boost retirement savings when they do return to the workforce, women are often too conservatively invested to close the retirement gap to men according to a global survey of more than 34,000 investors by investment firm, BlackRock.

Women were also less inclined to take risks with their investments with only 28 per cent of women saying they would take on higher risks to achieve higher returns, compared with 45 per cent of men. The survey also highlighted these key habits of women who were on track to meet their retirement goals:

 

  • Spending time on their investments – up to seven hours per month
  • Making retirement saving a priority
  • Diversifying their portfolio, holding more shares and less cash
  • Seeking financial advice

 

YOUR SUPER INVESTMENT TIPS

 

 

 

FURTHER STEPS TO TAKE FOR A HEALTHIER SUPER FUTURE

So it’s time to take control of your super now and plan ahead. Here are some proactive steps you can get started on to build and protect your financial security.

  • Put it all together – Having multiple super funds can cost you more in fees. Consolidating your super and making contributions into a single fund can save you money in the long-term. However, it’s important to check your insurance cover before closing any of your super accounts to ensure you and your family continue to have the right level of cover.
  • Add your own voluntary contributions – Your employer’s super contributions may not be enough to give you the retirement you want. Making extra voluntary contributions throughout your life can help boost your super savings. You can make payments from your pre-tax salary, known as salary sacrifice, if your employer offers this. Your total pre-tax (concessional) contributions within the annual cap will be taxed at just 15%.

To find out more about making extra contributions into your super, including the limits on how much you can contribute, visit HERE

No matter how far away you are from retirement, it’s important to plan ahead for a comfortable retirement.

To get started, head to Shadforth and choose ‘Retirement gap calculator’ or contact a Shadforth adviser on 1300 308 440 to arrange an initial and no-obligation meeting at our cost.

 

If you would like to talk to an experienced and talented financial advisor click HERE.