It’s a familiar story for millennial women, growing up with a superannuation system that’s already disadvantaged and devastated so many women before them.
Millennial women like me have grown up knowing that ‘a man is not a financial plan’. While I can confirm that a man (or partner) has never been part of my financial plan, neither has retiring in poverty.
With recent research by ethical women’s super fund, Verve Super, suggesting that young women, like generations before us, are heading for a rude awakening in retirement; I am scared. What can we do to make the super system fairer?
With a Mum who was educated and had a career, yet who took significant time out of the workforce to raise my sisters and me, I knew early on that I needed to take care of myself when it came to my finances.
According to the Association of Superannuation Funds of Australia, to have a ‘comfortable’ retirement, I will need almost $550,000 in retirement savings. Yet, the amount I’ve so far amassed in superannuation after ten years of working is enough to last me about a year in retirement.
And, I’m one of the lucky ones.
Mine feels like a familiar tale for lots of young women – a low super balance borne of volunteer work, a major illness, freelancing and contract work, and working in the community sector, which is dominated by women (read: underpaid).
If things continue the way they are for many young women, we’re going to end up in the same predicament that women retiring today are facing: older and in poverty.
Working with women in the community sector in Victoria, I saw firsthand the impact of financial insecurity and dependence. Older women are the fastest growing population of people experiencing homelessness. Women in their 50s and 60s are sleeping rough, living in their cars, or staying in abusive or toxic relationships because they don’t have the financial security to leave. This is something that needs to change now, let alone by the time Millennial women retire.
Too much of our system relies on having at least one partner earning a significant amount of money – presumably a man. But what if this male partner doesn’t earn much money, or you’re in a same-sex relationship, or you’re single? What if you work in the informal economy and are not actually paid any super because you earn less than $450 a month? What if you take a significant amount of time out of the workforce to care for children or elderly parents?
The superannuation system, as it stands, does not account for the nuances and diversity of the Australian people – especially women. Not to mention the rising number of women who are self-employed or freelancing because the traditional workforce can’t meet their needs.
Until women, or anyone, who performs caring duties or duties in the home is financially compensated; until those who take time out of the workforce to parent are not penalised by lack of career progression and non-flexible work environments; until we have equality or at least parity – the system will never be fair.
We need to recognise our power as consumers, as investors, as changemakers. The finance and super industries are trying to better cater for the diversity of our population – but the rate of change is too slow, and we need to make the system fairer for us all. Now.
As women, we need to pool our collective power and wealth to address the structural inequity and injustice embedded in our financial system. That might mean joining an ethical women’s super fund, or switching banks to one that better aligns with your values, or even simply holding your friends accountable to savings goals and committing to increasing your financial capabilities together.
Superannuation is here to stay, so let’s make it fairer for us all.
Join Verve Super’s Make Our Future Fair campaign here.