Gender Disparities in Retirement

Melbourne, Aug 23: Vanguard’s comprehensive examination of demographics within the framework of the How Australia Retires study has unveiled significant gender-based disparities in the path to retirement for Australian women.
A fresh analysis of data encompassing over 1,800 working and retired Australians has brought to light pronounced differences faced by Australian women, spanning homeownership, personal super balances, personal investments, annual income, and overall confidence levels as they approach retirement.
Reflecting on these findings, Vanguard’s Shannon Nutter remarked, “A spectrum of circumstances places women at an unequal advantage in terms of preparing for retirement or achieving a well-prepared retirement.”
The study highlights that, on average, Australian women earn 13 per cent less than their male counterparts.
This gender wage gap is compounded by factors such as women often working in lower-paying industries, taking breaks to manage familial responsibilities, caring for children, and having a longer life expectancy.
“These factors result in women needing to save or invest more to retire comfortably, yet they possess fewer initial assets,”Nutter adds,

Confidence Levels

The research delves into gender differences in confidence levels and decision-making about retirement plans. Australian men demonstrate higher confidence and optimism regarding both their financial decision-making capabilities and retirement plans compared to their female counterparts.
The study reveals that 50 per cent of men surveyed expressed “very” to “extremely confident” sentiments about financial decision-making.
In contrast, only 33 per cent of female respondents shared the same confidence.
Moreover, 11 per cent of men reported being “slightly” or “not at all confident” in their financial decision-making, while this number increased to 23 per cent for women.
The study also reflects a discrepancy in understanding investment products and services, with women notably less confident.
Interestingly, men felt moderately or very confident in a broader range of financial products and services.
A significant gender gap is observed in understanding Superannuation, with 20 per cent of women compared to 8 per cent of men feeling “not at all confident.”
Financial Circumstances of Pre-Retirees The study unveils that a third of working-age women have super balances below $20,000, whereas only 12 per cent of men fall into this category.
Conversely, approximately 60 per cent of working-age men report balances exceeding $100,000, double the proportion of women.
Furthermore, around 73 per cent of pre-retired women reported personal income under $75,000, while nearly 70 per cent of pre-retired men reported earnings ranging from $50,000 to $200,000.

Financial Circumstances of Pre-Retirees

The study unveils that a third of working-age women have super balances below $20,000, whereas only 12 per cent of men fall into this category. Conversely, approximately 60 per cent of working-age men report balances exceeding $100,000, double the proportion of women.Furthermore, around 73 per cent of pre-retired women reported personal income under $75,000, while nearly 70 per cent of pre-retired men reported earnings ranging from $50,000 to $200,000.

Retirement Expectations and Planning

In terms of retirement expectations, women express a desire to retire earlier than men (62 years vs. 63 years), yet they anticipate retiring later than men (66 years vs. 65 years).
This gap widens further among single women, who expect to work the longest (68 years).
Interestingly, a greater proportion of female pre-retirees (22.1 per cent) expect their retirement funds to last 30 years or more compared to male counterparts (13.7 per cent).
For those already in retirement, 42 per cent of female retirees indicated uncertainty about the duration of their retirement funds, contrasting with 23 per cent of male retirees.

Engagement with Super Fund

The study also uncovers that women exhibit less engagement with their super funds compared to male respondents, regardless of their retirement status.
Around a third of younger women have never initiated contact with their super fund, while only 24 per cent of younger men fall into this category.

Addressing Retirement Preparedness

Beyond the crucial aspect of earning more money, which both genders cite as a key driver of retirement preparedness, the study highlights the significance of better understanding required retirement funds. More women view ongoing guidance, age-appropriate plans from their super funds, and a clear understanding of improving financial outlook as pivotal in achieving desired retirement lifestyles.
The study emphasizes the importance of addressing gender disparities and empowering women to take control of their financial lives, offering insights into how individuals, partners, governments, and industries can collectively create an environment conducive to gender equality in retirement planning.