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New five point plan to help women build super

by Ali Cain | 26 Sep 2017

A boost for low-income earners’ super balance and a range of other public sector initiatives are at the heart of Women in Super’s (WIS) Make Super Fair campaign. The initiative is designed to lift women’s retirement savings. 

According to the most recent RaboDirect Financial Health Barometer women can expect to have nearly $200,000 less at retirement then men. A recent survey by the Australian Services Union found women are retiring with around half as much superannuation (53 per cent) as men.

The Make Super Fair campaign is a five-point plan WIS is calling on the government to pursue to help women achieve a more comfortable retirement:

  1. Give low-income earners an annual super contribution of $1000.
  2. Make sure there are no further delays in increasing employer super contributions to 12 per cent.
  3. Remove the rule that those earning less than $450 a month – who are mostly women – don’t get super.
  4. Pay super on parental leave, like all other types of leave.
  5. Government should measure and publish the super gap each year, and assess the impact that any future legislative changes to super would have on women.

Sandra Buckley, executive officer of Women in Super, says the pay gap between the genders is certainly one significant reason for the super gap, but there is also a range of factors that contribute to the super gap. New five point plan to help women build super - InFinance - FINSIA 1
There’s an underlying belief that the type of work women do and the attributes they bring to the workplace are not valued as much as men's contributions and it’s really difficult to shift that perception,” says Buckley.

Women also tend to undertake jobs in which they can take advantage of shift work and flexible hours to combine with childcare in sectors such as retail, hospitality and nursing.

“But these are demanding physical roles. These are not jobs you can do on a long-term basis. So a lot of women are forced to retire early, often due to ill health,” she adds, explaining that this reduces their earning capacity and retirement savings.

Research backs this up. WIS’ has undertaken a three-year study looking at the factors that derail people’s retirement plans. Initial findings indicate blue-collar workers tend to retire earlier due to circumstances outside of their control such as ill-health and redundancy.

In contrast white-collar workers, who are already more highly paid, can often shift down to part-time work, or take on more flexible positions such as consulting and board roles, to maintain their employment and income.

Women also tend take time out of the workforce to look after children and in later life many retire earlier than they would wish to because they take on caring roles for elderly parents. New five point plan to help women build super - InFinance - FINSIA 2

All of this has a bearing on the comparatively smaller amount of retirement savings women have. 

Dr Carla Harris, CEO and co-founder of the Longevity App, explains how the super gap is impacted by the gender pay gap. 

“Women also live longer than men so they have less money to stretch out, and they can find themselves in a precarious situation,” she adds.

Harris says whatever the situation there are always steps women can take to improve their financial position.

“Employers have a really big role to play structuring work so people who have caring responsibilities can remain in the workplace and keep contributing to super. Providing super contributions to people on parental leave is something else employers can do,” she adds.

There’s also an opportunity for women to think differently about how they are planning for their retirement.

Natalie Yan-Chatonsky, co-founder of Full Time Lives, a social venture helping skilled professionals transition from their full time careers, has been interviewing women who are at different stages of planning or transitioning from full-time work and going into part-time or full-time retirement.

“A lot of the skilled women over 50 I've been interviewing say retirement is liberating because they have more options. For instance mothers with children who have become independent can ramp up their work or consider trying new career paths,” says Yan-Chatonsky.

“Their earning capacity can also be higher because they have fewer limitations on the types of jobs they can take. Previously responsibilities as working mothers with dependent children may have put certain jobs, for example those with long hours or lots of travel, out of reach.” she says.

Given later in life may be a period that opens up new opportunities, some women are choosing to become ‘seniorpreneurs’. They are starting new businesses, which can also help boost retirement income.

Others may use digital marketplaces to generate incremental income for instance Expert360, Etsy and AirBnB.

As this shows, a three-pronged attack by governments, businesses and women themselves is needed to wage war on the super gap. 





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