Non-English speakers, women, over 55s face largest super gap

New research from the Association of Super Funds Australia (ASFA) has found Australians from non-English speaking backgrounds (NESB), women and people over the age of 55 face the largest gap in retirement savings.

Analysis of Australian Taxation Office (ATO) data revealed that the average superannuation balance in 2022 for a person of NESB who is retiring was $320,000, compared to $460,000 for all Australians with super who were retiring.

This is despite significant increases in the median account balances from 2014 to 2022. The median account balance for NESB males grew from $35,000 in 2014 to $100,000 in 2022; for NESB females, their median retirement savings balance grew from $19,000 to $100,000.

For NESB males over the age of 55, their median balance also rose from $100,000 to $200,000 across the eight years; for NESB females over the age of 55, their median balance grew from $50,000 to $120,000. However, these balances were still lower than the equivalent general population over the age of 55: $250,000 for males and $170,000 for females.

“People from non-English speaking backgrounds make up 16 per cent of total super account holders in Australia and unfortunately, their super balances are lower across every age group when compared with the general population,” ASFA CEO, Mary Delahunty, said.

“The upcoming Federal Budget presents a clear opportunity to address the retirement savings gap for people from non-English speaking backgrounds. ASFA is calling for an increase in the Low-Income Superannuation Tax Offset (LISTO), which would boost the low super balances of more than 200,000 people from non-English speaking backgrounds.

“Increasing the Low-Income Superannuation Tax Offset to $45,000 would mean $700 directly put towards the retirement savings of some of Australia’s lowest paid workers, providing an extra $200 per year than what is currently contributed by government and also substantially increasing the number eligible for the tax offset.”

ASFA also said that the Government’s plan to pay the 12 per cent Super Guarantee on Commonwealth Paid Parental is a massive step forward for women from non-English speaking backgrounds.

“As the voice of super, we know how important it is to highlight areas of our world class system that need additional attention to deliver dignity in retirement for all Australians. We have forwarded this research to the Government, to the Minister for Immigration, Citizenship and Multicultural Affairs and other key decision-makers to consider for the upcoming budget,” Delahunty said.