Tuesday 5 March 2024 New consumer research prepared by Colonial First State ahead of International Women’s Day has found that almost half (44%) of Australian women admit they are financially unprepared for retirement.
The findings reveal a 13 percentage point gap compared to 31% of men who said they were financially unprepared for retirement.
The research, based on a survey of 2,247 Australians, found that one in four (25%) women felt ‘extremely unprepared’ for retirement compared to just 15% of men.
CFS Superannuation CEO Kelly Power believes financial literacy is the key to improving confidence and retirement preparedness among women.
“Our research found that one in three women admit they have little to no understanding about super, investments and retirement savings products,” Ms Power said.
“We know that financial literacy, engagement with your super fund and seeking advice have a major impact on improving women’s financial confidence,” she said.
Many younger women are eager to engage with their super fund to improve their financial literacy and seek advice.
The CFS research found 70% of women aged 25 to 29 are interested in getting financial advice and paying for it with the funds in their super.
The research also revealed the significant value that financial advice has in preparing women for retirement.
Two in three women (67%) who do receive advice have a financial strategy in place, compared to just 24% who do not have an adviser. Meanwhile, three in five women (61%) who receive advice feel financially prepared for retirement, compared to one in five (20%) who do not have an adviser.
Ms Power said that for those who may not be able to access advice, engaging with their super fund could be the first step towards improving financial literacy and boosting confidence.
“One in three women who have never received advice said they don’t seek any guidance about their finances, from any sources,” Ms Power said.
“Engaging with your super fund is an important first step towards improving your financial literacy and building confidence about retirement,”” she said.
“CFS is committed to improving the financial confidence of Australian women by not only raising awareness of these issues but outlining some of the simple steps women can take to boost their confidence and take control of their financial future.”
The first thing women can do is find out who their super provider is. Log in to your account and check your super balance. See how your super has performed over the last 12 months. If your super is underperforming, it may be time to consider switching to a different fund.
Having multiple accounts means you could be paying multiple sets of fees.
Consolidating your super is one way to reduce unnecessary costs that could be impacting your super balance. However, there are some circumstances where having more than one super account may be right for you, including retaining any existing insurance cover.
Speak to your super fund or financial adviser about consolidating your super.
If you don’t have excess funds to contribute to your super, you may want to consider setting aside some time each week to broaden your knowledge. This could be as simple as engaging with some of the educational content provided by your super fund, jumping on retirement calculators and getting familiar with commonly used terms. ASIC’s Moneysmart website is a great resource.
Women are more likely to report that they have never made plans for their financial future, don’t set financial goals, and don’t keep to a set budget.
This is where financial advice can be hugely beneficial. We know that women who receive advice are far more confident and far more prepared for retirement.
Financial advice has changed significantly in recent years and new reforms are underway to make advice more accessible and affordable.
In the year ahead, CFS will be introducing new services and tools that will give members access to topic-based simple super advice.
We also partner with thousands of financial advisers across Australia who can help you with your retirement planning needs.
CFS encourages anyone open to financial advice to visit the CFS Find an adviser site and take the first step to accessing a financial adviser to help identify and achieve their financial goals.
James Mitchell, Senior Manager External Communications, Colonial First State
+61 413 619 034
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This media release is issued by Superannuation and Investments HoldCo Pty Limited ABN 64 644 660 882 (Colonial First State or CFS). The CFS group includes Colonial First State Investments Limited ABN 98 002 348 352, AFSL 232468 (CFSIL) and Avanteos Investments Limited ABN 20 096 259 979, AFSL 245531 (AIL). CFS is majority owned by an affiliate of Kohlberg Kravis Roberts & Co. L.P. (KKR), with the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945 (CBA) holding a significant minority interest. This information is current as at 01 August 2023 and may be subject to change.