The celebration of International Women’s Day is an excellent time to remind ourselves that women are still retiring with lower superannuation balances than men – almost 50% less. That figure, when translated in dollars, equates, on average, to about $90,000.

There are several factors contributing to this, but the simple fact of a gender pay gap of between 15% and 19% less for women in many industries, is the prime cause. Certainly, this was a key finding of the Senate Inquiry into Women’s Economic Security in Retirement that handed down its report in April 2016. Laws might have changed, and society might have a more enlightened attitude towards women working, but employers are still paying their female staff lower wages.

Indeed, research by Industry Super Australia (ISA) estimates that even with the changes in train, women are still likely to retire in 2030 with superannuation balances that are 30% lower, on average, than men. In dollar terms, average balances are projected to be $262,000 for women and $432,000 for men.

It’s not just lower pay. Other factors than make women second-class citizens in superannuation are:

• Fragmented work patterns with women typically having primary responsibility for family care. It’s not only children but elderly parents. It’s been estimated by ISA that taking five years off work from age 29 to 34 will shave $100,000 off women’s average retirement savings;
• Women dominate part-time and casual jobs that usually pay less;
• Women disproportionally work in administrative roles, community services and sales with historically lower pay;
• Fewer women reach senior executive and board level positions.
• Women typically retire earlier than men and live longer – a double whammy.

The Senate inquiry highlighted all these issues. As former Liberal Senator Sean Edwards, who was a committee member, said: “People who take time out of the workforce to meet family caring responsibilities, and those people are overwhelmingly women, are at an inordinate disadvantage when it comes to enjoying a comfortable retirement. There is no quick fix but it is important to try and address some of the very challenging long-term structural issues.”

That’s the downside. And as the former Senator says, there are no easy solutions. But there is an upside to the story of women and their retirement savings. Admittedly, it largely applies to women who are either professionals or self-employed. But it’s a starting point – a good one.

The evidence is growing that women in the self-managed super fund (SMSF) sector are playing a far greater role in the overseeing of their SMSFs, as highlighted by research commissioned by the SMSF Association and the Commonwealth Bank.

It should not be overstated. But the signs are certainly encouraging. For example, while more men than women are likely to initiate the establishment of an SMSF, the gap is narrowing as more women from Gen X and Y take the first step.

This is not surprising. Women of the Baby Boomer and Traditionalist (over 70) generations lacked the opportunity to have the careers of the younger generations, who have the confidence and education to take control of their retirement income strategies. They are increasingly less prepared to take a back seat and let their partner do the driving.

On the investment front, the research showed some interesting trends. One statistic has 91% of all SMSFs surveyed being either “very confident” (49%) or “somewhat confident” (42%) of having sufficient knowledge to take over the sole responsibility for managing their SMSF investments.

It’s a positive number, suggesting that the decision-making in SMSFs is far more collective than previously supposed, especially when it’s considered that a high percentage of SMSFs are husband-wife partnerships. It says that women have the confidence to take control of the fund in the event of divorce, separation or death, a declaration made all the significant when it’s remembered that 47% of the more than 1.1 million SMSF members and trustees are women.

The research also points to the fact that women are relaxed about getting specialist SMSF advice to assist them with their superannuation, understanding there are complexities in all areas of overseeing an SMSF.

In all of this the Government could assist by removing some structural impediments to allow them to improve their superannuation balances before and after retirement. This includes extending the benefits of the low-income tax offset and further improving the ability to carry forward unused concessional contribution caps.

As the Senate inquiry found, there is much to do to remove the superannuation inequality between the sexes. But in the SMSF sector steps are being taken to reduce gap. Small steps – but at least they are in the right direction.

Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regard to your circumstances.