Women often ask themselves, what are men really thinking.
When it comes to superannuation and the gender gap that exists in retirement savings, the answer is probably not a lot.
But there is evidence that more men are supportive of the need to share the love when it comes to equalising super balances with a partner, particularly if they have taken time out of the workforce to care for kids.
AMP Capital chief economist Dr Shane Oliver says it is unlikely that men think about women having less in their super accounts, “unless they are prompted by financial advisers.”
Current statistics show that on average women has about half the superannuation savings as men at retirement age. This is commonly blamed on the gender gap that exists in pay and the fact that women are often the ones who take time off work to care for kids or other loved ones.
Even Michael Miller, financial planner and owner of MLC Advice Canberra admits that it took him some time before he understood why women are so annoyed about the superannuation savings gap.
“I work quite closely with some outstanding family and estate lawyers, so I am familiar with the mechanisms that transfer super from wife to husband, or vice versa, in the event of divorce, separation or death. If balances aren’t even before these processes start, they will definitely be that way by the end.”
Dr Oliver agrees that there is a tendency for men to think, “…if I die my then wife will inhertit my super balance” but he says then there are issues around independence for women and them having to play catch up in a system that restricts how much extra they can put in.
“One of the things that government could do is to relax rules around the maximum contributions that can be made”
“Unless there is policy intervention there won’t be any change. That means reality of women retiring with lower balances won’t change either,” says Dr Oliver.
Currently limits apply to how much before and after tax money you can put into your super savings each year. Click here to find out what they are.
The issue of independence is what brought about a change of thinking for Mr Miller.
“Not many men I know love the idea of going to their wife or partner and asking for cash to go out and spend. But by holding all the super in one name, we’re putting women in this position.”
Mr Miller says that couples should be discussing splitting their super to equalise balances the moment children are on the cards.
“People thinking about starting a family should be doing analysis or at least talking about what happens to superannuation when one pereson takles time off to have kids.
“If you are doing a prenup that is including arrangements for caring for children, superannuation is something to include in the agreement.
“Not everyone ends up with a prenup, but discussion about super sharing should happen,” says Mr Miller.
To read more about how Michael Miller changed his mind on equal super balances, click here.
