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How to set yourself up for success.
13 Feb 2025
From taking career breaks to raising a family, to systemic pay inequities, women face unique financial challenges that can have long-term impacts on their financial security.
But while some of these challenges are beyond your individual control, there are powerful steps you can take now to improve your finances and make your money work better for you – now and in the future.
By making smart decisions – including educating yourself on your financial options, negotiating your salary, and prioritising your superannuation – you can set yourself up for financial success.
Earning less now can impact you in the future in more ways than one, particularly when it comes to your super. These financial setbacks tend to compound over time, creating challenges that can affect women's financial security well into retirement.
Although progress has been made, women still earn less than men on average for the same roles. Australia’s gender pay gap is 21.8%, according to the Workplace Gender Equality Agency's gender pay gap data. That means for every $1 a man makes, women only earn 78c. Over the course of a year, that difference adds up to $28,425.
This doesn’t just affect women on a day-to-day basis, but gets worse over time. With less lifetime earnings, women can face greater challenges in everything from saving for a first-home deposit to building their retirement fund.
Many women take a break from their careers to raise children or care for loved ones. While these breaks are incredibly important, they often come at a steep financial cost.
Women’s earnings are reduced by an average of 55% in the first five years of parenthood, according to a paper on gender equality published by the Australian Government. This ‘penalty’ also includes missed opportunities for promotions and reduced contributions to superannuation.
Women retire with significantly less superannuation than men as a result of pay inequity and career breaks. On average, women have 25% less in their super accounts at retirement, according to The Association of Superannuation Funds of Australia.
The Association’s Update on superannuation account balances found the median balance for those aged 60 to 64 at $211,996 for males and $158,806 for females. This can leave many women financially vulnerable during retirement, especially given women tend to live longer than men.
The good news? While there’s no question women face real challenges when it comes to managing their finances and ensuring they’re financially secure for life, there are steps you can take now to close the gap and take control of your financial future.
Negotiating pay can feel daunting, but it’s a crucial skill to master. Women who ask for a raise are more than twice as likely to get one as women who don’t, according to Lean In’s ‘Women in the Workplace’ Report.
Confidence and preparation are key to a successful salary negotiation. Research your industry’s pay standards and be prepared to advocate for your worth. Try practising with a trusted friend or mentor beforehand.
Salary increases not only boost your current income but also mean your employer makes higher super contributions – another win for your future savings.
Understanding how to manage your finances is a skill that pays dividends. Take the time to learn about budgeting, saving, and investing.
Make a plan to ensure you’re living within your means while setting aside money for savings and investments. Explore options like shares, property, or managed funds to grow your wealth outside of super.
There are plenty of free and affordable resources, from online courses to financial podcasts, to help you get started.
An emergency fund is your financial safety net. It can cover unexpected expenses, such as medical bills or car repairs, without derailing your long-term savings goals.
A recent survey by Finder found that 1 in 3 Aussies don’t have an emergency savings fund. Of those who do, the same survey found that men have a lot more in the bank than women: $17,832 compared to $6,859.
While it is challenging, aim to save three to six months’ worth of living expenses in a high-interest savings account. This fund provides peace of mind and ensures you won’t need to dip into super or other investments in times of need.
Superannuation is the foundation of a secure retirement, and prioritising it now could be the key to a comfortable financial future.
Salary packaging super is one clever way to boost your super savings, by making additional super contributions from your pre-tax income. Not only does this reduce your annual taxable income as you give up some of your take home pay, but it also helps grow your retirement savings over time. We’ll go into this in more detail in the next section.
Some other ways to boost your super? If you’ve taken time off work, consider making additional contributions to your super to catch up. Even small amounts can make a big difference over time. Just be aware of the annual contribution limit ($30,000), if you go over this limit you will pay extra tax, and ensure you maximise this allowance to get the most out of your super contributions.
You may be able to contribute more than $30,000 if you have not contributed the full amount in previous years.
If you have more than one super fund, all your contributions are added up and count towards your caps. If you go over these caps, you may need to pay extra tax.
If you want to learn more about how much you can contribute to super, the contribution caps and tax, visit the ATO website.
One way women can take control of their financial futures? Salary packaging your superannuation*. Not only does it potentially provide tax savings as you give up some of your take home pay which reduces your taxable income, but it also supercharges your retirement savings over time, setting you up for a more secure financial future.
Here are a few benefits of salary packaging super for women:
By making additional contributions to your super from your pre-tax income, you’re giving up some of your take home pay, and you’re reducing your annual taxable income. This means you may pay less tax and boost your super balance. What’s not to like?
Contributions made through salary packaging are usually taxed at a concessional tax (before tax) rate of 15% up to a cap of $30,000 each year, which is often much lower than your income tax rate. Over time, your super will grow through the power of compounding returns.
It’s important to understand however, that all investments, including super, inherently carry some level of risk and are subject to volatility. Volatility refers to when returns on your investment increase or decrease over time. The level of volatility associated with a super fund largely depends on the types of assets that it holds. At times, investment markets can experience heightened volatility, leading to negative returns.
Whether you’re dreaming of a peaceful retirement in the countryside, cruising around the world, or simply having the financial freedom to spend time with loved ones, a healthy super balance can make those dreams possible.
And, of course, we always recommend you talk to a financial advisor before making any financial decisions.
While systemic barriers persist, women have the power to take control of their financial futures through smart, proactive decisions. From salary packaging superannuation to building an emergency fund, these strategies are simple, effective, and within your reach.
Whether you’re exploring salary packaging for the first time, or wanting to add new benefits, we make it simple. Thanks to our easy-to-use tools and dedicated support team, salary packaging is now simpler than ever.
Step 1: Check your eligibility
Step 2: Explore your benefits
Step 3: Apply now
In just a few simple steps, you can unlock the benefits of salary packaging.
Disclaimer: This is general information only. Before entering into any salary packaging or novated leasing arrangement, you should consider your objectives, financial situation and needs, and obtain appropriate legal, tax, financial, or other professional advice based upon your own particular circumstances. This information is current as at 10 February 2025.
* Your employer's salary packaging policy and your employment status determines whether you can salary package additional superannuation. To check if this benefit is available to you, visit Superannuation | Smart and enter the name of your employer.