Tuesday, March 12, 2013

Women, Superannuation and Work

 According to Office for Women, it is estimated that by 2019, women will have on average half the amount of superannuation that men will have. Currently, the average superannuation payout for women is a third of the payout for men - $37,000 compared with $110, 000.

Why is this?
The work patterns of women are very different from men. Women are more likely to take time off work to care for young children, sick children, or other family members. It is important to acknowledge that taking time off work to care for others lessens a person’s opportunities in the job market and therefore the ability to earn superannuation – and secure a healthy financial future.

What are some possible solutions to this growing problem?

  • The provision of paid maternity leave has the potential to increase women’s superannuation balances. Where women receive an income during maternity leave, they will continue to accumulate superannuation.
  • More family friendly workplaces to increase women’s participation in the workforce. Job sharing, flexible hours, child care facilities, and working from home arrangements are all measures which support men and women to balance work and family responsibilities.
  • Encouraging father-friendly practices in the workforce to lessen the sole burden of caring on women. Women now account for nearly 50% of our workforce.
  • Speaking to a financial planner about superannuation so families are aware of the latest superannuation laws.
Federal Sex Discrimination Commissioner Elizabeth Broderick has called for a broad Productivity Commission Inquiry to look at options to overhaul the care sector and acknowledge the impact of unpaid care on career progression and retirement savings for women.

Key among the proposals for reform, Ms Broderick is calling for the Productivity Commission to implement a carers' credit system, aimed at supporting those who provide care for others in their retirement.

"That would be where the government made a national superannuation payment each year for those carers who are doing a certain amount of care, maybe 20-25 hours a week, but that would ensure they weren't disadvantaged significantly in retirement," she said.

There is a great resource on MoneySmart (ASIC and Australian Government website) that provides calculators and tips to help you make better financial decisions. There is also information about contributing extra money to your superannuation account.

The other important resource to refer to is the Australian Taxation Office website. Find out more about:

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