Planning for retirement is a daunting task and many Australian women lack confidence in financial decision making. Fortunately, there are some small steps women can take today to make a positive difference to their future.

It’s probably no surprise to hear that Australian women often retire with less money than their male peers. New research* by Colonial First State (CFS) confirms that even in 2024, this is still the case.

There are several reasons for this, including well documented wage gaps and the uneven burden of raising a family which often results in women taking breaks in their careers.

Not only do women end up investing less money through super over their careers but this means they’re also missing out on the compounding effects that future returns will have on their balances.

And CFS found that while 78% of men have made plans for their financial future, only 67% of women had done similar. Women were also less likely to set financial goals*.

All is not lost, though. Read on for some simple steps that will help women start to take control of their super and their future.

Knowledge is power

It’s important to note that women care about their finances just as much as men do. In fact, women are more likely to feel worried about their finances or guilty that they’re not doing enough to manage finances compared to their male peers*.

So, what’s holding them back? Our research shows one major hurdle is confidence – or more specifically, that women aren’t as confident with money and investing as men*. It’s hard to make good financial decisions when you don’t trust that you know what a ‘good’ decision looks like.

Luckily, financial confidence is strongly linked to knowledge. The more we know about super and investing, the more confident we can be in our decisions.

What’s more, there are several easy ways for women to brush up on their financial knowledge and be able to back themselves.

Is there good news?

Australian borrowers breathed a sigh of relief with the double rate pause, while the announcement of Michele Bullock taking over as RBA governor was well received. She will become Australia’s first female central bank leader in the RBA’s 63-year history and will serve a 7-year term.

Some economists are suggesting that interest rates have now reached their peak. Others remain uncertain, however it certainly signals a slowdown in pace and lessening rate hike pressures.

• Regularly check up on your super

Many people approach their super with a ‘set and forget’ mindset but this attitude can leave you in the dark when it really matters.

Aim to regularly check in on your super, making sure your contact details are right (so you’re receiving all the important information and notices) and that you’re happy with the performance of your investment option.

• Bring it all together

Most Australians have more than one super account and are paying multiple sets of fees as a result. Consolidating all your super into one account can help you save on fees and make your super easier to manage.

What’s more, you may even have super money that you’ve forgotten about. According to the ATO, there was more than $16 billion in ‘lost’ super as at 30 June 2023 – accounts which have stopped receiving regular deposits, typically after someone has changed their job, name or address.

• Top up

We know most women have lower super balances than men^ but the power of compounding (where you earn interest on your money and on the interest it has earned), means you can start making a difference today.

Summing up

Taking hold of your financial future is easier than you think. Here’s a summary of our tips to get you started:

• Check your super balance.
• See if you have any lost super or multiple accounts you might like to consolidate.
• Look at topping up your super. Even a small amount could make a difference.
• Learn more about super.

* Source: CFS commissioned survey of 2,966 Australians and research was completed in March 2023. Findings and statistics in this article are based on this research.

^ Source: Australian Families Then & Now: Income and wealth (aifs.gov.au)

Source: Colonial First State