Superannuation & women
Super - even more important for women
Women tend to live longer than men, making it even more
essential that they accumulate enough superannuation to last
But women face unique challenges when it comes to retirement
savings. Lower pay, time out of the workforce to raise
children, or running a single-parent household, can make it
challenging to build a reasonable amount of super. However, some
simple strategies make it possible for women to overcome these
Super is good for you
Superannuation is a
very tax-effective way to save for retirement. Your super fund pays
a low rate of tax on contributions and investment earnings while
you grow your nest egg. From age 60, you can withdraw your super
The 2017 Hilda survey found that Australian
women retired with an average super balance of $230,907 and
men retire with about twice this amount.
Without super, many women must rely on the Age pension in
their senior years. But the Age pension is designed as a safety net
and won't provide you with a comfortable life.
Taking time off paid work (e.g. to have a baby or care for
someone) or working part time can impact your super.
Work out how working part-time or taking a break from paid work
affects your super in retirement.
Get to know your
Your employer should be making super contributions on your
behalf. These contributions will be equivalent to 9.5% of
your salary or wages.
If you haven't given your employer instructions about the super
fund of your choice, it's likely the contributions are paid into a
MySuper fund your
employer has chosen. This may not be the sort of fund you would
By law, you can normally choose your own fund and have your
employer's contributions paid into that fund. If you have several
super funds, it's a good idea to roll over or consolidate your super into
your preferred fund. This will save you extra administration
fees and make it easier to keep track of your super.
To choose a super fund, look at the all the fees charged
and the long-term average returns of the investment option you are
comfortable with. Don't base your choice solely on past
investment returns, as past performance may not be a
reliable indicator of future performance.
When choosing a fund also consider the insurance it provides and
the level of cover you require. For more information see
insurance through super.
Options to grow your super nest
There are a number of ways to build your super. You cannot
normally access your super before you retire, so only contribute
money you can afford to set aside.
- Ask your employer to pay part of your pre-tax salary or
wages into your super fund. Making concessional, or salary
sacrificed super contributions can be a tax-effective way to
grow your super.
- Make super contributions out of your own
pocket. Non-concessional contributions, also known as after-tax
super contributions, are not subject to the 15% contributions tax
that can apply to other types of contributions. Depending on your
annual income, you may also be eligible for government super
contributions. It's an easy way to give your super a valuable
- Ask your partner or spouse to make contributions on your
behalf. He or she may be able to claim a tax offset on the
contributions made to your fund.
Even small contributions can make a big difference over
Work out the best way to add to your super.
Case study: Ajinder boosts her super savings
Ajinder was concerned that
she didn't have much superannuation, and wasn't keen on the idea of
relying solely on the age pension. She decided to take action to
get her super under control.
'It struck me that I have 15 or so years until I retire. My
super isn't great at present, so I've started adding a bit extra to
my super each month by making payments out of my own pocket. It
means I get the government co-contribution each year.
'I'm also going to ask my boss if I can salary sacrifice a small
amount direct from my pay - and that means I pay less income tax.
It's not a lot but my super balance should grow over time thanks to
investment returns. Every extra bit I add now will make a
difference to my retirement.'
Track down lost super
If you have ever held a part-time or casual job, or moved house,
you could have superannuation invested in a fund that you've lost
Use myGov to keep track of all your super and
combine multiple super accounts into one, which will make it even
easier to manage your super. More more information, visit the ATO's
page on checking your super.
Superannuation is very important to the quality
of your retirement. By adding even small amounts to your super now,
you will make a big difference later in life.
Last updated: 12 Aug 2017