WOMEN not only bear the babies and the brunt of juggling children and child care, they also bear a huge financial burden from raising them, new research shows.
Analysis from Hewison Private Wealth has found the average woman is about $200,000 worse off at retirement if she opts to have a baby.
This is despite starting out by having the same salary and career path as a man or a woman who does not have a break because of children.
The massive financial shortfall is the result of a woman who goes on maternity leave, returns to part-time work for several years and then eventually full time again, Hewison director Chris Morcom says.
During that time, she has missed out on wage increases and career development which permanently sets her earning capacity and career prospects below her colleagues.
In turn, this means her superannuation fund savings are much lower, Morcom says.
Self-managed super fund specialist DBA Lawyers spokesman Bryce Figot says women are also behind in the DIY fund sector.
About 54 per cent of self-managed fund members are men and, of these, they typically earn a much higher income than the 46 per cent of female members.
“Underfunded superannuation is a really big issue for women and it’s a function of several factors, including not getting a fair play,” Figot says.
“It’s basically a function of how much they earn and, on a pure statistical basis, women are still paid less then men.
“It’s also about the number of years they have in the workforce, with many women having to take significant amounts of time off to raise families, instead of dedicating that time to their career.
“But the real kicker for women is that they live longer and actually need more money in retirement than men because it has to last longer.”
Australian Institute of Superannuation Trustees chief executive Fiona Reynolds says most women run out of super after little more than a year after finishing work.
“About 57 per cent have nothing left after a year,” Reynolds says.
“It’s time to get creative with policies that recognise most women will take career breaks to have children and care for other family members.
“Without change, women will continue to come up second-best in retirement.”
Research by AIST has found that only two-thirds of retired women have any superannuation and, of those that did, their median balance is just $31,000. The median balance of women currently in the workforce is just $27,200, Reynolds says.
Hewison’s Morcom says women need to contribute 15 per cent of their wages (not just the basic 9 per cent super guarantee) during their working life to make up the typical shortfall.