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Menopause costs women’s retirement outcomes

Media Release 8 March 2024

One in seven Australian women will pay a superannuation savings penalty as they transition through menopause by taking time out of the workforce, or retiring prematurely, according to a new research report by the Association of Superannuation Funds of Australia (ASFA).

ASFA, the voice of super, found that a 51 year-old woman on the average wage who shifts from full time to part time work over four years will be $25,000 worse off at retirement.

Women who are unable to continue working during menopause and are forced to retire around five years prematurely are potentially foregoing an estimated $60,000 in lost retirement savings.

“160,000 Australian women enter menopause each year,” said ASFA CEO, Mary Delahunty.

“As a direct result of menopause, around 20,000 Australian women will at some point switch from full-time to part-time work, around 10,000 will leave the workforce and return later, and around 4,000 women will retire prematurely because of severe menopause symptoms.

“Each of these actions will have a significant and detrimental impact on their individual retirement outcomes,” Ms Delahunty added.

Australian superannuation funds including Cbus Super, Aware Super and Future Super have introduced progressive policies to support their female employees through the provision of dedicated paid menopause leave days.

ASFA continues to welcome measures that seek to address the retirement savings gender gap. The milestone announcement that the Government proposes to introduce Super Guarantee ( SG) on Paid Parental Leave ( PPL), is a significant measure, long-advocated for by ASFA, and an important step towards closing the retirement savings gender gap.

As part of the Senate Inquiry into Issues Related to Menopause and Perimenopause, ASFA is calling for a comprehensive survey of Australian women regarding the impacts of menopause transition on work and career, including early retirement.

“As the troubling Workplace Gender Equality Agency (WGEA) gender pay gap findings laid bare, it is impossible to meet a challenge as important as this one, without first determining its size and scope,” concluded Ms Delahunty.

Key research findings:

  • A woman who is 51 (on average wages for age), and who shifts from full-time to part-time work (3 days per week) for a period of four years, would have around $25,000 less superannuation at retirement (assumed retirement age of 67).
  • A woman who is 51 (on average wages for age), and who leaves the workforce for a period of two years, would have around $30,000 less superannuation at retirement (assumed retirement age of 67).
  • Premature retirement of around 5 years (for a woman on average wages for age) would mean lower superannuation at retirement in the order of $60,000.
  • For some women, multiple effects could apply i.e. periods of leave from the workforce and early retirement.
  • Aside from a shortened career, early retirement can leave many women drawing-down on their superannuation earlier than would otherwise have been the case.
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