A recent report released by Australian Institute of Superannuation Trustees revealed that women are retiring with approximately half the super amount men are retiring with. The life expectancy of women is higher than men but the super amount they are retiring with it is significantly lower.

The following are the main reasons why women end up with less super:

1. For starters, women earn less than men. I had discussed this disparity in pay in an earlier post.

2. Most women, when they have kids, have breaks in their career. And not all women who return to workforce will end up working full time.

3. When they do return to full time work after a break in career, they might have to accept a lower salaried position.

Ideally I think when women go on maternity leave, Government should make some kind of contribution towards their super. But don’t hold your breath. Women of current generation might never reap the benefits of this ideal situation.

So here are a few things you should do to protect yourself:

1. Before you go on your maternity leave, try to put some extra money every month towards you super.

2. Even while you are on maternity leave, try to put money into your super (as much as you can). Does not have to be large sums, even little amounts will make a difference.

3. Get your spouse to make some contributions towards your super. There are tax benefits for spouse contributions. So you win both ways.

4. Make some personal contributions towards your super. If you do this and you meet the income criteria, then the Government will contribute some of their money for every $1 of your investment. The maximum they contribute is $1.50 for every $1 of your contribution. This contribution reduces with income.

The low super balance of women is an issue which has been swept under the carpet for many years. Governments are always quick to encourage women to have more babies - On the same token, shouldn’t they also be contributing towards our super?

What do you think about this issue? Do leave your comments….

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