Money Gender Imbalance - New Data Released

Income levels and the gender pay gap are topics that are receiving quite a bit if press lately, and rightly so. It is alarming that after so many years and with widespread awareness, that this is still even a topic we are discussing!

What triggered this blog post is some new data recently released by the Australian Taxation Office (ATO) on median incomes based on gender and occupation. Plus, superannuation levels between men and women across different age groups.

Without getting too much into Economics, wage growth has been pretty low, with the median taxable income increasing by 12% from 2014 to 2020. Just the cost of housing has increased by between 20 and 30%. Then there is inflation in general, which is tipped to peak at 7% just this year.

This amplifies the need to become financially literate, and to understand what life you actually want.  Being deliberate and intentional with spending, saving and investing is then very important.

Financial literacy is not about being good at maths. There are so many tools and calculators out there, that you don’t need to be good with numbers at all. It’s more understanding the concepts and the impacts of your decisions. Plus, it’s the language that is important – what the terminology actually means and what you need to focus on. So many people want to tell you how complex money is, and there are so many money stories about why this must be true, which in turn holds you back.

I’m going to call BS on that, because I feel so passionate about changing this story, especially for women!

From my own story – my parents migrated to Australia, and both had come from tumultuous backgrounds – either economically or because of war. Being able to earn decently without any financial education meant they spent more than they earned for too long, and that led to stress and anxiety about money.  I remember coming home one night and there was no power, because the electricity bill hadn’t been paid.  

Even an experience like that wasn’t enough for me to educate myself on personal finances.  I didn’t even know this was something that you could learn!  It took me years of trial and error before I finally came to realise that money was something I needed to learn about. Which is what I then did.  

Back to the data from the ATO – in 2020, the median taxable income for men was $56,746.  While, for women it was $41,724. That’s 26% lower! This is likely to be due to many women working part time (or not at all), so they can take care of the kids, but it’s still concerning.

Then, the data on superannuation balances tells a similar story. Up until the age of 30, the super balances of men and women are basically the same. From then the gap progressively widens until retirement. Once again, by either not being in the workforce, or working part time, plus having to build back up a career after looking after kids, it takes women longer to get back to a salary level where they can start catching up on their super.

This puts women at a significant disadvantage, financially. Becoming money savvy is the best way to reduce the imbalance!