Superannuation is a cornerstone of retirement security in Australia, yet significant differences remain between the retirement savings of women and men. While the gap has narrowed over time, it continues to shape women’s financial outcomes in later life.
The State of Super: Women vs. Men
According to the Association of Superannuation Funds of Australia, in 2025, the average super balance was about $192,119 for men and $154,641 for women. This equates to approximately 20% less for women.
While the gap has narrowed slightly over the last decade, largely due to higher workforce participation, women nearing retirement (aged 60–64) still retire with roughly 20–25% less super than men.
Why do women have lower Super balances?
The differences in super balances are driven by structural and life-pattern factors rather than a single cause.
1. Career breaks and time out of the workforce
Many women take time away from paid work for caregiving responsibilities, particularly during child-rearing years. Because super contributions are tied to earnings, these breaks reduce long-term accumulation.
2. Higher rates of part-time work
To balance caregiving responsibilities, a higher proportion of women work part-time or in casual roles. Since super is calculated as a percentage of earnings, lower hours directly translate to lower contributions.
3. Compounding effects over time
Superannuation relies heavily on compound growth. Lower contributions early or mid-career can lead to disproportionately smaller balances at retirement.
4. Workforce patterns and industry distribution
Women are more likely to work in sectors or roles with lower average super contributions and fewer opportunities for additional employer contributions.
How women can boost their Super
Although structural factors play a role, there are several practical strategies women can use to grow their super over time.
1. Make voluntary contributions
Even small, regular contributions (e.g. salary sacrificing or after-tax contributions) can significantly boost balances due to compounding.
2. Take advantage of government incentives
Schemes such as co-contributions or tax offsets for lower-income earners can help increase super without requiring large personal contributions. If you are a low-to-middle income earner, the government may match your personal after-tax contributions up to $500 per year.
3. Consolidate multiple accounts
Combining super accounts can reduce fees and prevent unnecessary erosion of savings.
4. Stay engaged with investment choices
Reviewing and selecting appropriate investment options (e.g. growth vs conservative) can improve long-term returns.
5. Spousal contributions
Partners can contribute to each other’s super, which can help balance retirement savings within a household.
6. Resume contributions early after career breaks
Returning to contributions as soon as possible after time out of the workforce helps rebuild momentum.
What is Super Splitting?
Super splitting (also known as contribution splitting) is a strategy designed for couples to help level the playing field. It allows one partner to transfer up to 85% of their concessional (pre-tax) contributions from the previous financial year into their spouse’s account.
Key features:
- Typically applies to employer contributions, salary sacrifice amounts and personal deductible contributions
- Can help equalise super balances between partners
- May improve tax effectiveness and retirement outcomes as a couple
For example, if one partner has a significantly higher super balance, splitting contributions can boost the lower-balance partner’s account over time.
Conclusion
Women’s superannuation balances in Australia have improved over the past decade, with faster growth rates and a narrowing gap relative to men. However, differences remain significant, particularly later in life.
Understanding the causes, such as career patterns, part time work and compounding effects, highlights why early and consistent engagement with super is crucial. By making strategic contributions, using available incentives and considering tools like super splitting, women can take practical steps to strengthen their financial security in retirement.
For more information or to review your superannuation strategy, please contact Senior Financial Adviser John Mujic or your principal adviser.
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Senior Financial Adviser |
