Superannuation contribution caps unfair to women

retirement-savings/SMSFs/SPAA/self-managed-super-fund/superannuation-funds/australian-taxation-office/chief-executive-officer/government/

23 January 2012
| By Milana Pokrajac |
image
image
expand image

Contribution caps help widen the gender gap in retirement savings as they do not allow women to catch up with their superannuation after career breaks such as maternity leave, according to the Self-Managed Super Fund Professionals' Association of Australia (SPAA).

SPAA has called for both the industry and the Government to help women plan for retirement and narrow the gender gap in superannuation.

One way of addressing the gender imbalance in retirement savings is to introduce opportunities for both compulsory and voluntary contribution catch-ups for women when they take maternity leave, according to SPAA chief executive officer, Andrea Slattery.

"However, the caps on their contributions in a period of their career when they can catch up on their retirement savings disadvantages them compared to those remaining in the workforce and reduces their superannuation balance when they retire," Slattery said.

"Restoring the superannuation contribution caps to their pre-2009 Budget levels will encourage greater retirement savings by those who can afford to make extra super contributions at certain times in their lifecycle," Slattery added.

SPAA pointed to figures released by the Australian Taxation Office, which show an average member balance of $439,000 for a female SMSF member.

However, women in other types of superannuation funds have an average member balance of $22,000.

"The gap in superannuation balances between men and women tends to be narrower within SMSFs as women are more engaged with their finances, the fees for SMSFs are a lot lower and there is a growing number of women wanting to make their own decisions when it comes to retirement savings," Slattery said.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 1 week ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

3 weeks 1 day ago

Minister for Financial Services, Stephen Jones, has provided further information about the second tranche of the Delivering Better Financial Outcomes (DBFO) reforms....

2 weeks ago

One licensee has lost 27 advisers in the past week, now sitting at zero, according to the latest Wealth Data figures....

3 weeks 1 day ago

TOP PERFORMING FUNDS