Currently, retirement may not be so super for women. Compared to men, women spend less time in the work force, earn less, save less for retirement, and live longer. A woman retiring at age 65 can be expected to live 3 to 4 years longer than a man and will continue to be more than half of Australia’s aging population. Her retirement security needs to be catered for.
On many indicators the current superannuation system is performing well. However, part-time and lower income earners are not currently saving adequately for retirement. Women are especially disadvantaged.
To date, an equal treatment of the genders by the superannuation system has resulted in unequal outcomes. A superannuation gender gap exists. Recent policy initiatives and tax incentives have done little to close this gap.
The Australian superannuation system is relatively young, and most retirees have not had full superannuation coverage for their whole working lives. To help close the gender gap and increase financial security in retirement, future policies need to specifically consider women’s needs.
The current mandated rise of the SG to 12% will help increase overall retirement savings, however, more needs to be done. The nexus between time in paid employment and the ability to save for retirement needs to be broken. Superannuation contribution caps and tax incentives need to acknowledge carers – currently mainly women – time out of the workforce and be based on family units rather than individuals.
Rather than acting as a safety net, the Age Pensions role in providing for old age needs to be expanded and be better integrated with superannuation savings.
To achieve a sustainable retirement income system for future retirees, policy makers have a responsibility to close the superannuation gender gap.