As women in Australia increasingly take control of their financial futures, it’s important to recognise the unique challenges they face—and the strategies available to overcome them. From lower superannuation balances to longer life expectancy, women must plan carefully to ensure financial security throughout their lives and into retirement.
The Growing Importance of Financial Advice for Women
More women than ever are seeking financial advice, whether they’re managing household finances, running a business, or planning for retirement. According to JB Were, women are set to control more than $3 trillion in wealth in Australia by 2030. Despite this, many women face significant obstacles when it comes to long-term financial security, particularly due to career breaks for caregiving and longer life expectancies.
Women often earn less over their working lives, resulting in lower superannuation balances. Compounding this, women live an average of four years longer than men, meaning they must stretch their retirement savings further. These factors make it critical for women to take proactive steps in managing their wealth.
Common Financial Challenges for Women
Lower Superannuation Balances
Women tend to accumulate less in their super accounts due to career breaks for raising children, part-time work, or lower salaries. This gap leaves many women underprepared for retirement.
Longer Life Expectancy
With women living longer on average, they need to plan for a longer retirement, covering both day-to-day expenses and potential health or aged care costs.
Caregiving Responsibilities
Women often take on the role of caregiver, not only for children but also for ageing parents, which can limit their earning potential and opportunities to grow their wealth.
Financial Strategies to Bridge the Gap
To address these challenges, there are several strategies that women can implement to secure their financial future:
Boost Superannuation Contributions
One of the most effective ways to improve retirement outcomes is to top up super while still working. Salary sacrificing allows women to contribute more to their superannuation while reducing taxable income. This approach is especially important for those returning to work after a career break.
Additionally, the super co-contribution scheme allows low-income earners to receive matching contributions from the government, providing a boost to retirement savings with no extra cost.
Spouse Contribution Splitting
For women with partners who earn more, spouse contribution splitting can help balance out superannuation savings within the household. By transferring some super contributions from the higher-income partner to the lower-income partner, couples can increase the super balance of the person with lower savings—often the woman.
Planning for Longer Life Expectancy
Given that women typically live longer, planning for a longer retirement is essential. This includes building a retirement plan that covers not only the basics of living expenses but also accounts for potential health care or aged care costs later in life. By considering the long-term picture, women can ensure they don’t outlive their savings.
Seek Professional Financial Advice
At Wealth Fundamentals, we’ve seen firsthand how women are often more open to financial advice than men. Whether it’s navigating complex superannuation rules, planning for retirement, or protecting assets for future generations, seeking professional guidance early can make all the difference.
The Role of Wealth Fundamentals in Empowering Women
At Wealth Fundamentals, we believe that every woman deserves to feel confident about her financial future. Our 7 Fundamentals provide a clear framework to help women build a secure financial foundation, no matter where they are in life.
Our 7 Wealth Fundamentals include:
Income Plan: Creating sustainable income streams for now and the future.
Investment Plan: Building wealth through diversified investment strategies.
Debt Plan: Managing and reducing debt effectively.
Risk Plan: Protecting your assets and family with tailored insurance solutions.
Superannuation Plan: Maximising your super and preparing for a comfortable retirement.
Estate Plan: Ensuring your wealth is passed on according to your wishes.
Cash Flow Plan: Managing daily finances for long-term financial stability.
By aligning your financial plan with these fundamentals, we ensure your strategy is comprehensive, adaptable, and focused on your long-term goals.
Take the First Step Toward Securing Your Future
Women face unique financial challenges, but with the right strategies and support, they can overcome these obstacles and secure a bright financial future. If you’re concerned about how to close the wealth gap, improve your superannuation, or prepare for a longer retirement, now is the time to act.
At Wealth Fundamentals, we’re here to help you navigate these challenges and build a financial plan tailored to your needs. Our team works closely with you to ensure your financial goals are met and your financial security is safeguarded for years to come.
If you would like to know more about financial planning, please contact Matt Lane or Alec Winter on 07 3720 1299 or email admin@wealthfundamentals.com.au
Lane Moses Pty Ltd ABN 56 092 186 117 trading as Wealth Fundamentals and its advisers are Authorised Representatives of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306.
The information (including taxation) contained within this document does not consider your personal circumstances and is of a general nature only - unless otherwise stated. Wealth Fundamentals strongly suggests that you should not act on it without first obtaining professional advice specific to your circumstances. This information is based on our understanding of legislation at the time of writing. Such legislation may be subject to change. This publication cannot be reproduced in any form without the express written consent of the author.