The superannuation gender gap widened to 18% as the early release of super scheme during the COVID-19 pandemic had a greater impact on the average woman’s super balance, according to Colonial First State (CFS).
CFS’ latest research said the gender gap had widened 2% from 16% in 2016, contrary to the belief that the country was inching towards closing the gender super gap.
“While more men accessed their super early during the pandemic, the impact on average super balances of women was more pronounced (21% compared to 18% for men) because of the lower starting balance for women,” its ‘Retirement Realities’ research said.
“The data also showed that men were approximately 20 percentage points more likely than women to sacrifice their salary into super (61% compared to 39%).”
The research also found its members aged under 30 took almost one-third of all early super release payments to total $1.5 billion. It said 41% of those members were yet to start rebuilding their super savings.
CFS general manager, Kelly Power, said: “The gender gap in the Australian superannuation system is a real issue that sees women financially disadvantaged. Coronavirus has pushed us back even further, creating greater urgency for solutions to the retirement realities challenging Australians, particularly women.
“The super industry and the government must unite to create a system that closes the gender gap for good. Specific measures such as mandating super contributions on paid parental leave and removing the $450 per month threshold for superannuation to be paid will improve the retirement savings adequacy for low-income earners and casual workers, many of whom are women.”
The research also found that women between the age of 50 to 64 years who sought financial advice made a 199% higher average voluntary contribution in 2020 than women who did not seek advice. Advised males were 85% ahead of the non-advised.
“It’s encouraging to see that female members recognise the importance of super as they approach retirement. With help from their adviser, they can contribute extra to their super from any spare cash, including any inheritance or dividend payments, or sale of property,” Power said.