Single women are unlikely to close the 'retirement gap' even with a lifetime of employer superannuation contributions, meaning many will not enjoy a comfortable retirement, says Rice Warner.
Rice Warner was commenting on the white paper, For Richer, For Poorer , it produced on behalf of the Actuaries Institute, which found that women still struggle to fund their retirement.
Rice Warner chief executive Michael Rice said: “Many young females will not achieve a comfortable retirement even after a lifetime of employer support.”
The report, which was released on Wednesday, found that a single woman's retirement income is expected to be $38,000, compared to single males with an average income of $49,000.
Mr Rice suggested that to combat this issue, in addition to other concerns, flaws within the superannuation system need to be mitigated.
According to Mr Rice, fees need to be lowered as many Australians are paying to much for superannuation.
“Members need to consolidate all their accounts and they should measure their employer’s fund against a few well-known, large funds,” Mr Rice said.
Mr Rice also said that tax and social security need to be addressed.
“Rice Warner is hopeful that the Tax White Paper Task Force will seek a sensible integrated policy, in part to encourage more Australians to be self-sufficient in retirement.
“If we could reduce dependency on the age pension from 75 per cent to 20 per cent of retirees, we could then afford to pay more to support our poorest pensioners," he said.
Mr Rice also argued that superannuation funds need to ensure their members are invested in the right options.
“Investing in growth assets before and during retirement is critical.
"Funds should perhaps be concerned more with enhancing retirement returns, and less about sequencing risk – the latter can be handled by shifting money into cash at the right time and not by changing the overall asset allocation of the fund,” said Mr Rice.
The report highlighted that the superannuation does need changes.
“The Financial System Inquiry recommended that a new objective be enshrined which focuses superannuation on providing retirement income rather than accumulating assets,” said Mr Rice.
“This idea is supported by the Actuaries Institute, guided by the principles of sustainability, flexibility, equity, efficiency and simplicity.”
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