Those of you who read the entertainment pages may have seen an interview recently with Kate Winslet about gender pay inequality in response to Jennifer Lawrence’s call for equal pay for male and female actors. Most people, but women in particular should be alarmed by what she said about not talking about money because it was “vulgar”.
However with the average gender wage disparity in Australia across all industries at almost 25% or about $290.90 a week on average, not talking about it does women an enormous disservice. This is a topic that very much needs to be discussed.
Women are routinely not paid the same as men for doing the same job, and it’s astonishing that this is still an issue and still happening in the 21st century. Surely we should have moved beyond this being an issue.
By not taking about it and sweeping it under the carpet we are tacitly agreeing with this and allowing this to continue. We do need to talk about this disparity, as women are greatly disadvantaged financially in general, but pay inequality makes this disadvantage worse.
Firstly, women have smaller balances in things like superannuation and savings accounts as a direct result of this inequality. In addition, women generally tend to predominantly have lower paying jobs.
Secondly, this is compounded by women usually taking time off from work to be the primary caregiver for children. This reduces their earning capacity and those years of not making superannuation contributions can make a big difference to the final payout figure.
Thirdly, women are also generally worse off financially after a divorce, particularly if there are children involved.
Finally, paradoxically women generally live longer than men statistically speaking, so therefore require more for their retirement, but due to the above factors, usually have less.
Not being fairly compensated only compounds these issues.
Here are some tips for women to try and help balance the equation and to offset this inequality:
- Talk about money: Don’t fall into the trap of thinking it’s not the done thing to talk about money or it’s vulgar. This is the 21st century and this attitude that we don’t talk about money should not still exist. Money is not a taboo topic. Money impacts on every facet of your life, whether you realise it or not, or even whether you like it or not. Include children when talking about money so this attitude doesn’t persist. The best things in life might be free, but it won’t pay your bills.
- Empower yourself with knowledge: Look at what the pay range is in your industry or line of work. Where do you sit in the range, salary wise? Discuss this with your supervisor at work and see how you can readdress the imbalance if you feel you fall under the norm.
- Boost your super and savings: Consider salary sacrificing into your superannuation or pension fund and set up a separate savings account into which you regularly contribute, but you don’t use for spending. Use this for investing.
- Boost your super through splitting contributions: If taking time off work to raise children, consider splitting your partner’s superannuation contribution between both your two super accounts, so that at least some contribution is being made into your superannuation account while you are not working and not in a position to make contributions. This will at least help to offset some of the management fees and hopefully help to increase the balance as well.
- Look at creating other income streams: Your job should be just one avenue of income for you. Look at ways you can create alternatives through investments and creating small or micro businesses.
- Have a plan: Knowing how much you would like to have upon retirement is a start. At least you will have a figure you know you need to work toward.
Considering a woman’s longer lifespans, this is potentially disastrous.
According to Ross Clare in the Superannuation Account Balances by Age and Gender report, in 2014 the average superannuation balance for women was $54,916 while for men it was $98,535.
The average retirement balance in 2014 for women was $138,150, as opposed to $292,500 for men, a large discrepancy.
The report also noted that average balance disparities between men and women emerge at relatively early ages. One of the main contributing factors for this is most likely to be gender wage inequality.
Isn’t it time we addressed this imbalance?