Retirement phase plagued by gender biases

A recent study from Vanguard has highlighted the gender imbalances encountered by Australian women before and as they enter the retirement phase across superannuation, income, home ownership, investment and overall confidence.

Titled ‘How Australia Retires’, the study found while 50 per cent of men were either very or extremely confident about making financial decisions, only 33 per cent of women felt the same way.

This was also reflected in the 64 per cent of women who felt “not at all confident” about investing in products such as bonds compared to 37 per cent of men, as well as the 20 per cent of women who felt “not at all confident” about superannuation compared to eight per cent of men.

“There’s a whole spectrum of circumstances that mean women aren’t on equal footing when it comes to being able to prepare for retirement or to retire well,” Vanguard Executive Consultant, Shannon Nutter, said.

“On average, Australian women earn 13% less than their male counterparts, often work in industries with lower wages, take time off to manage home-related issues, care for children, and live longer.

“All this means that women need to save or invest more to retire well, but have less assets to start with.”

The study also showed females intended to retire earlier than males, but either lacked a clear plan (46 per cent) or still expected to retire later than men, with single women expecting to work the longest (68 years). This comes as less women were found to have engaged with their super fund when compared to men, with 33 per cent of younger women having never contacted their fund compared to 24 per cent of men.

“Many studies including Vanguard’s own investor data show that women are typically very disciplined investors. They are less likely than men to take on too much risk and tend to maintain a long-term view rather than engage in trading behaviours to score a quick return,” Nutter said.

“These traits are considerable strengths which can enable women to take charge of their own financial lives. We all need to take ownership of our financial futures and take actions that will help us retire the way we envision. This might mean women whether single or partnered take time to understand the different aspects that contribute to retirement.

“For instance, being aware of their household finances, getting smart about debt, planning and seeking advice, investing regularly, making additional contributions to super and getting comfortable with negotiating better compensation.

“This analysis has highlighted in particular, the areas in which the industry can provide for female clients to ensure everyone, equally, can move more confidently towards a great retirement.

“Managing personal finances and thinking about money can feel intimidating and it’s easy to disengage and kick it down the road or let someone else handle it. But women can and should do more.”