The system is unfair - but there are ways to help yourself get ahead, writes Ruth Williams.
Chris Panagiotopoulos has a lot on her mind right now - and it's fair to say her superannuation balance is not top of the list.
Panagiotopoulos, 36, has a four-week-old baby daughter, Julia, and a 2½-year-old son, John. Right now, she is more concerned about adjusting to life with another child, and her eventual return to paid work, than planning for events still decades away.
"You don't see it - it's something that's put away and tucked away for when you need it later in life," she says. "I'm still in my 30s, not nearing retirement, so it is something I don't pay close attention to."
And she wouldn't be alone.
For many women in their 30s and 40s, life is a frantic juggle of work and family - full of situations and events that need immediate attention. Planning for a distant retirement can end up low on the list of priorities.
It doesn't help that the super industry seems to struggle to engage with women; last year, a survey by the Association of Superannuation Funds of Australia (ASFA) and Suncorp found that women were more likely than men to feel " inadequate, ashamed or dumb" when it came to their superannuation.
Forty-one per cent of women surveyed said they felt "powerless".
Yet the culmination of a series of factors means it is critical for these women to think and plan carefully for the times ahead. These include the longer average life-spans of women, the gulf between male and female pay packets, and, especially, the hit to a woman's superannuation caused by years of reduced or halted earnings spent caring for children or older parents.
Experts are warning that without action by employers, super funds, governments and women themselves, a generation of Australian females will face a drastic shortfall in retirement savings, leaving them vulnerable to markedly reduced standards of living in their later years.
"Why is it acceptable that women should, in retirement, have less income and be less comfortable than men?" says Cate Wood, chair of super industry networking and advocacy group Women in Super. "Especially when what's caused that is that they have spent time caring for children or the elderly. It doesn't seem equitable."
The figures are sobering.
While one or two years off work to have children might not seem like much in the context of 35 years or 40 years in the workforce, it can add up to several tens of thousands of dollars in lost super and earnings from compound interest.
Research by ASFA suggests a 32-year-old woman on $65,000 a year will miss out on $28,000 in super if she takes two years off work; the same woman earning $85,000 a year will be $36,500 behind.
Add in the fact that women still earn less than men - $261 a week based on full-time weekly earnings - and it becomes clear why the yawning gap between average male and female super balances persists.
Based on the Household, Income and Labour Dynamics in Australia (HILDA) survey, the gap in super balances between working males and females starts expanding when workers are in their early 20s, widening to $10,000 for the 25-34 age bracket and blowing out to a whopping $117,000 for those in the 60-64 age group.
But what does this mean? For many women, a severely crimped lifestyle in retirement and several years - the final years of one's life - spent living solely on the age pension.
Wood, also the president of the Australian Institute of Super Trustees, points to research by the institute that finds women living on the pension who own their own homes are "managing". But, she says, "they were from a different generation, a generation that's more adept at coping with lower incomes.
"It is an issue looking ahead for those who are having great difficulty getting into the property market. It's very challenging for single mothers trying to manage. It's very daunting."
The financial implications of the shortfall in super for females are set out in stark terms by research from Rice Warner Actuaries, which has crunched the numbers on what a woman would need to set aside for an "adequate" retirement income of $40,391 a year - a figure that ASFA calculates would provide a comfortable standard of living.
To have an adequate income until her life expectancy age of 94, a typical 20-year-old female starting her career on $34,300 a year would need $613,000 in her super account when she retires.
But Rice Warner's "typical" female, after regular promotions and salary increases, will end her working life with $426,500. This may seem like a hefty sum - but it will mean she will need to rely solely on the age pension after she reaches 86.
Build in a career break of five years - a year off for the first child, then part-time work for two years, another year off for the second child and another year of part-time work - and her nest-egg shrinks to $380,500, giving her only enough income to last until 83 - leaving her on the pension for potentially more than a decade.
Crucially, ASFA's calculation of $40,391 for a "comfortable" lifestyle in retirement assumes ownership of a home. But today's 35-54 year olds are less likely to be home owners than in previous generations; almost 68 per cent of the 35-44 age group were home owners in 2010, the HILDA survey found, a figure that had declined 4.5 per cent in 10 years.
Rice Warner deputy chief executive Melissa Fuller warns that, as things stand, future generations of retirees will have to "significantly" change their lifestyles to match their income.
Among those women who have already retired, 49 per cent relied solely on the age pension in 2011, compared with 40 per cent of men. About 69 per cent of Australians of pension age receive a part or full pension - and 56 per cent of these are women. The single pension is $21,018.40 a year.
Fuller warns the sharp dive in income in later years may come as a particular blow to women now in their 20s and 30s, who are accustomed to a higher standard of living.
But this is already the reality for many women in their late 40s, 50s and 60s, who are struggling to house themselves, Brotherhood of St Laurence researcher Helen Kimberley says.
"This is already happening, it's started, and it's going to increase," she says.
Kimberley warns that women with no spouse or partner, little or no superannuation and who have had extended time out of the workforce to care for children - or, increasingly, older parents - are particularly vulnerable to poverty, because many struggle to get back into the workforce. This includes women who would consider themselves highly qualified and "middle class".
Kimberley's research suggests age discrimination in the workforce begins for people aged about 45. "People have a downward spiral," she says. "Each job is worse than the last one, it pays less, offers less satisfaction, its status is lower and it is less secure."
Those who are married will fare better if their spouses can help support them, Kimberley says. "But even if, financially, that's not a big issue, from the point of view of identity, it's a big issue."
Many women assume that when they retire they will have plenty of assets to support them - including their partner's super, the family home and investments. But Wood cites the saying: "a man is not a plan".
Her advice for young women is to step up super contributions before they take time out of the workforce to have children. "It's not a great sacrifice, it's almost like a coffee a day to contribute extra into your super," she says. "Compound interest makes a huge difference."
Women now in their 30s and 40s should consider boosting their super payments once they are back at work.
"The best way is to save up through salary sacrifice with the maximum that you can," she says.
She also advises women to consolidate their accounts and to seek financial advice. As for husbands and partners, they can contribute to their spouses' super or split their super contributions with their spouse. Both options have potential tax benefits.
But it's not just women and their families being urged to act.
As a federal election looms, the policies of both major parties are under scrutiny.
The Labor government's Paid Parental Scheme, which pays primary carers 18 weeks at the minimum wage, does not include super - a move that would cost the federal budget just $20 million a year, according to ASFA.
"Getting super would be a step in the right direction," Fuller says. "It's a form of pay, why not pay the super guarantee on it?"
The Coalition's paid maternity leave scheme gives women six months of full pay after a baby and includes super.
Lifting the super guarantee to 12 per cent - as promised by Labor - will boost the super balances of all workers. Labor, under former prime minister Julia Gillard, had pledged to lift the guarantee over six years from this month. But the Coalition says it will delay the move to 12 per cent by two years.
ASFA and Women in Super are also calling for the end of a requirement that a worker must earn at least $450 a month from the same employer to be paid super.
According to ASFA, this would benefit 250,000 Australian workers.
But Wood says more "innovative" measures are needed.
Sex Discrimination Commissioner Elizabeth Broderick suggests "carers credits" to bolster the super accounts of people who leave paid work to act as carers.
Some employers have stepped up; National Australia Bank, for example, pays super contributions of 10 per cent when its workers are on parental leave.
And Rice Warner has gone to the Human Rights Commission for an exemption from the Sex Discrimination Act to pay its female workers an extra 1.5 per cent superannuation "to address the barrier of higher longevity for its female staff".
"We need to offer women ways of covering [their absences from work], particularly to save more and ways to catch up later in life if you need to," Wood says.
What you can do
If you're planning to have children at some point, boost your super contribution now. You'll benefit from the compound interest on those contributions for the rest of your life.
Go to the MoneySmart website to work out how much extra contributions could add to your super balance. A 40-year-old earning $50,000 with a balance of $35,000 — the median for women aged 35-44 — could boost her $259,827 balance at age 67 by more than $8000 by salary-sacrificing just $20 a month.
If you're on a low- or middle-income wage, check whether you're eligible for the government's co-contribution scheme. This gives a tax-free boost of up to $500 for workers on less than $46,920 who contribute extra to their super.
If you're on maternity leave or working part time, consider whether your partner could contribute to your super.
If you're back at work after taking leave, consider boosting your super contributions now. ASFA and Suncorp suggest following the "1 per cent rule" - contribute an extra 1 per cent to your super for every two years spent out of the workforce.
If you're thinking about changing jobs, assess the super and parental leave policies of potential employers.