FIS Webinar: Financial Information on Super for Women

Super Gender Gap

Australian superannuation faces a critical juncture as reforms roll out to tackle the gender disparity in retirement savings. Women consistently retire with lower balances due to factors like lower wages, part-time work, and career interruptions for caregiving. Recent data shows women aged 60-64 hold averages of $313,360 compared to men's $395,852, a gap exacerbated by systemic issues.

Key changes include the Super Guarantee rate hitting 12% in July 2025, boosting contributions across the board. More targeted is the addition of super on government-funded Paid Parental Leave (PPL) from the same date, directly countering the impact of maternity breaks. This policy, long advocated by industry groups, could add thousands to women's balances over time, though payments to funds begin in 2026.

Payday super, mandating employers pay contributions with wages from July 2026, addresses unpaid super—a problem affecting one in four women, totaling $15.5 billion lost over the past decade. Lower-paid and younger women, especially those under 40 earning below $25,000, suffer most, with half missing entitlements. This reform eases tracking and reduces evasion, but requires swift legislation to avoid delays.

The Low Income Super Tax Offset (LISTO), a refund offsetting 15% contributions tax for low earners, sees its cap rise to $45,000 and maximum to $810 from July 2027. This benefits 1.3 million, predominantly women, potentially lifting retirement funds by $15,000 each. Yet, the gender pay gap, now at 7.3% hourly or $1.26 billion weekly in lost earnings, remains a core driver, fueled by occupational segregation and unequal care burdens.

Non-obvious tensions include employer resistance to payday super's administrative costs versus workers' gains in timely compounding. Surprising data reveals the gap widens with income—18% at higher levels—highlighting discrimination's role. Reforms help, but without bolder steps like super on all carer payments, progress stalls, risking poverty for older women amid rising life expectancies.