Before I wrote the book Super Freedom: A woman’s guide to superannuation (published in late 2011), I had often discussed the need for a practical non-technical book for women on superannuation. The first question I was asked when I told some female friends that I was writing a book for women on superannuation and retirement was: ‘Why does there need to be a book on super especially for women? Don’t men have to think about this stuff too?’ Yes, men do have to think about this stuff, but women have to deal with this stuff in a different way to men.
A male friend of mine suggested I should just add a supplement chapter to one of my existing books, explaining the special issues women face when planning for retirement. On the surface, his suggestion had merit because my existing books, and the SuperGuide website, are certainly written with both female and male readers in mind, but as you probably already know, there are bigger issues playing out for women wanting to create a better life for themselves in retirement.
Since the book, Super Freedom, was published, we have developed a special section for women on the SuperGuide website, to help women discover how to create a better life financially in six steps, and you don’t have to spend thousands of dollars in financial advice to make this happen. (For a list of the main articles om the section, see list at the end of this article.)
Women have different life experiences to men
Although we may all like to think women and men are the same in terms of money and finance, women generally have different life experiences to men, such as:
- earning less (on average)
- living longer than men (on average); which generally means women need to save more for retirement than men, or live a more modest life in retirement
- taking time out of the workforce to bring up children
- continuing to be the main carer of children from a marriage or other type of previous relationship in the event of divorce or separation
- reducing or rescheduling work hours to care for an elderly parent, or parents
- for most women in their late-fifties or older, not being given the option of having a super account until much later in life, if at all.
The major difference between a man and woman, when saving for retirement, is directly linked to the fact that the most popular way of saving for retirement is through Australia’s superannuation (super) system. The Australian super system was originally designed for a traditional male who worked full time for 35 years and remained married to the one person for his entire life. If you don’t fit into the traditional male definition of a working life — and most women (and some men) don’t — then you definitely need to be more hands-on with your retirement planning.
I have spoken at many seminars where women in the audience would approach me after the presentation and say, for example: ‘now I understand what my superannuation savings can create for me — why didn’t someone tell me this earlier?’ Other women would comment on the fact that I talked their language, rather than the language of the money men.
It was fantastic to receive such positive feedback from seminar participants, but I also appreciated that there was a real problem. Although the superannuation industry is spending millions of dollars to encourage Australians to think about planning for retirement, many women are not hearing the message. Although the government is offering tax incentives to save for retirement by using a superannuation fund, many women are not taking advantage of these incentives. Why not?
I have worked in, or written about, the superannuation industry for 30 years, and the answer to this question is now patently clear to me. Many women haven’t been heeding the plan for retirement message because most of the information available about superannuation and retirement is not targeted towards women; rather, it is targeted towards some average person that rarely resembles a female.
Women learn differently to men on money matters
From my thousands of conversations with women over the years, I believe that many women believe that financial freedom, particularly in retirement, is not possible. A financially stress-free retirement is indeed possible, and the easiest way to achieve this dream is by getting to know how the superannuation rules can benefit you.
In terms of finance and money, women often learn differently to men. Women like to discover the benefits of a product or service, or what it can deliver for them. Men like to do that too but many men also love to get under the hood and see how something works. In my experience, the process of how superannuation works seems to engage the blokes more than the women, and for some crazy reason the main focus in Australia seems to be on the process of saving for your retirement — typically the superannuation rules — when I believe the focus should be more on the outcome — wanting a comfortable life in retirement.
Clearly the super rules are essential information, but such information is most helpful when you know what lifestyle you want in retirement, and how much money is necessary — your retirement target — to deliver that lifestyle. You can then use the superannuation rules to help you reach your retirement target. In other words, much of the information available on retirement planning explains what the super rules are, rather than explaining how you can create the retirement lifestyle that you want by using the super rules.
The specialist articles for women on SuperGuide are different, and the information is tailored to the life experiences of women, and we use case studies to illustrate how doing a little can dramatically improve your retirement lifestyle, and doing a lot can totally transform your life after work or raising children.
Women are a diverse group facing unique challenges
The superannuation system has certainly improved over the years, although women who don’t work full time, or women who are self-employed, definitely have to think more creatively when it comes to saving and planning for retirement. What’s new? I believe thinking outside the box has always been a necessity for women, and this can reap unexpected financial rewards.
Women often have to work smarter, think smarter and tailor a standard system to suit their unique needs. Fortunately, women are highly adept at doing this because most women, in most parts of their life, are facing similar issues, whether it be raising children, managing work–life balance, tackling the boy’s club in society or traditionally male workplaces, or working in under-valued female-dominated industries.
On the SuperGuide website, we deal with all types of women, although I do want to make an important point about women who may be single or divorced or widowed. Most women at some stage in their lives will live alone — either by choice or by circumstance. If you’re a woman, you may never marry; you may be single before you marry; you may divorce; you may outlive your husband or partner; or you may end up living apart because your partner (or you) suffers aged-related illness. Many wealth accumulation information services don’t cater for women living on their own, but our website certainly does.
The aim of my book, Super Freedom, was to help Australian women (although men found the book useful as well) work out the steps necessary to create a worry-free lifestyle in retirement, and superannuation just happens to be one of the easiest ways to get there. Every woman deserves the opportunity to discover her own retirement dream, and this book, and the SuperGuide website, gives some handy tools to help make that dream come true.
If there is a single message I hope all readers will take from our work on SuperGuide, is that it is never too late, or too early, to improve your financial circumstances.
Although SuperGuide caters for women in all of its articles, the following SuperGuide articles may be especially helpful for our female readers:
- Super for beginners: 14 monkeys stop women creating a dream retirement
- How much super do you need to retire comfortably?
- How Much Super Is Enough Reckoner
- Life expectancy: Will you outlive your retirement savings?
- Super for beginners: Top 10 must-know facts
- SuperGuide checklist: 10 ways to save your super
- SuperGuide checklist: 10 more ways to boost your super
- Retirement planning: Choosing the right super strategies for your age
- Super for beginners: 8 steps to super success
- Why women must save more super, and why pollies should care
- Comparing super funds: Who’s who in the super zoo?
- Fund choice: Comparing super funds in 8 steps
- Divorce and superannuation: Who gets what?
- Gender gap on super boards: Large funds slow to change
You may also be interested in the following SuperGuide case studies:
- Case study: I’m 53. Is it too late to save for my retirement?
- Case study: Female, 45 and a worry-free financial future
- Case study: Female, 55 and fearful about retirement plans
For more articles relevant to women’s unique challenges when planning for retirement, see the SuperGuide section Women and super.