Women may be financially behind the eight ball when it comes to their salaries, but that doesn’t mean you can’t accumulate wealth. Statistics show that female graduate salaries are just 90.9 per cent of the equivalent male graduate salaries. And over time, the average working woman working full time earns 17.6 per cent less than men.1
Factor into that time off for children and it’s little wonder that women retire with an average super payment 43.1 per cent below that of men.2 While the inequality clearly needs to be addressed, women should still harness their ability to build wealth.
Good at saving Women generally are good at saving. A financial literacy survey by the Australian government in 2008 found that women are highly confident they have good saving habits.
While women are comfortable with saving, they are often more cautious and less confident than men in their ability to invest.
The survey puts this down to familiarity. Women are confident about day-to-day activities such as banking, budgeting and saving but less confident when it comes to more infrequent activities such as investing. But the sooner you start building your wealth, the more you will reap the benefits of compound interest.
Mind the gap Given that there may be gaps in contributions to your superannuation if you take time off work; it is worth considering getting a head start by supplementing your employer’s 9.25 per cent compulsory superannuation guarantee (SG) contributions through salary sacrificing.
That extra money in the early days will go some way to offsetting the years with no payments. You can contribute up to $25,000 a year, including your SG and more if you are over 59. Compound interest can make a huge difference to your final retirement savings.
Track your spending Budgeting lies at the heart of all financial plans. If you don’t know what you are spending, how can you control your money? There are many sites and mobile applications now available to help, including rackMySpend, MyBudgetPlanner and Jumsoft Money where you can easily monitor your spend.
Once you know what you spend, then you can look at ways to save and, in turn, what to do with those savings to grow your wealth. If it all sounds too complicated, consider using the services of a financial adviser to point you in the right direction.
And once you are on the road to accumulating assets, don’t forget to make sure you have a current Will. After all, it’s important you have control of your wealth and confidence that it goes where you want it to.
Women in wealth
1 Women Gender Equality Agency,http://www.wgea.gov.au/sites/default/files/2013-04%20-%20Stats%20at%20a%20glance_0.pdf
2 Women Gender Equality Agency,http://www.wgea.gov.au/sites/default/