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,
and 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 hurdles.
Super is good for you
In 2013-14, Australian women aged 60-64 had on average $138,150
in super savings which was less than half of the
average male account balance.
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
Without super, many women are forced to rely on the age pension
in their senior years. But the pension is designed as a safety net
and won't provide for a comfortable old age.
It's essential to focus on growing your super.
Taking time off paid work (e.g. to have a baby or carer
responsibilities) or working part time can impact your super.
Work out the impact on your super to find out what you can do to
improve your super balance
Get to know your fund
Your employer should be making super contributions on your
behalf. These contributions will be worth around 9.5% of your
annual wage or salary.
If you haven't given your employer instructions about the super
fund of your choice, it's likely the contributions are paid into a
fund your employer has chosen. This may not be the sort of fund you
By law, you can normally select your own fund and have your
employer's contributions paid into that. 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 the administration fees
charged by any extra funds.
To choose a super fund, look at the fees it charges and the sort
of investments the fund chooses. It's important that you are
comfortable with your super investment options.
Don't base your choice on past investment returns, as past
performance is not 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 nest egg
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 wage or salary
into your super fund. Before-tax salary sacrificing can be
a tax-friendly way to grow your super.
- Make super contributions out of your own pocket. These after-tax super
contributions, known as 'non-concessional' contributions, are
not subject to the 15% contributions tax that can apply to other
types of contribution. Depending on your annual income, you may
also be eligible for a government
co-contribution to your fund. It's an easy way to give your
super a valuable boost. Find out more from the Australian Tax Office: Super
- 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
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
'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: 18 Jan 2017