By Andrew Sherlock

A couple of lump sum payments into your daughter’s superannuation account could help her overcome the gender superannuation gap.

As International Women’s Day approaches and we reflect on the data which has emerged from the release of employer gender pay gaps, there is no better time to consider how we can improve the financial future of the women in our lives.

Despite female participation in the labour market increasing over the past few decades, there are still numerous factors at play which drive women out of paid work and into unpaid care roles. As a result, our daughters are set to retire with around $136,000 less than our sons; $150,000 less that what the Association of Superannuation Funds Australia defines for a comfortable retirement (based on Median income data).

In addition to accumulating less, the Federal Government identified in their 2023 Intergenerational Report that women will have a longer retirement to fund than men, due to retiring earlier to care for ageing parents and living longer.

What can we do?

There is a way that we, as parents and grandparents, can help ensure the young women in our lives are set to retire just as comfortably as their male counterparts.

Having recently returned from the SMSF Association’s annual conference, I was reminded that a couple of lump sum payments made into a woman’s super fund when she is young can make up for the loss of income experienced during unpaid maternity leave.

This can also ensure our daughters and granddaughters will have the same options in retirement as our sons and grandsons.

Gifting to superannuation can also be a tax effective way that can allow parents and grandparents to secure the transfer of family wealth to the next generation.

In addition to setting her up for a comfortable retirement, a contribution this early in her life can provide her with access to funds which she can use to buy her first home if needed. After all, the super gap begins at the age of 25 with a 19.4% difference in funds between the two genders, making the First Home Super Saver Scheme more accessible to men than to her.

The amount and timing of these lump sum payments are dependent on individual factors and will vary for every person. For more information or modelling on how you can help your daughter, reach out to us today.


For more information

Superannuation Gender Pay Gap by age

Intergenerational Report 2023

The Australian Institute Centre for Future Work

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