Why women should be getting financial advice 

Research from the Australia Institute’s Centre for Future Work shows that women in Australia earn $1 million less on average over their lifetimes than men and retire with $136,000 less in superannuation. The findings also indicate that women on the median wage accumulate about $393,676 in super, or $151,000 below what the Association of Superannuation Funds of Australia defines as a “comfortable retirement”.

The figures underline the importance of women engaging with an experienced financial adviser to map out a financial plan. Unfortunately, anecdotal evidence suggests that women all too often shun such advice for multiple reasons, including worrying that they will be talked down to by an adviser, and handing over control of their finances to male partners or by receiving advice passively through a family member.

One woman who has broken the mould is Jodie Francis, a Sydney woman who in 2023 sought out the services of a financial adviser and has not looked back.

She has a comprehensive financial plan that ensures she can live comfortably now and into her retirement years, while allowing her to pursue her passion for travel in retirement. “Having a financial plan gives me a lot of confidence that I have done the groundwork and can have a nice retirement,” Jodie says. “My adviser was also able to structure a plan that means I can potentially do things sooner than I expected to’.

While she urges other women to get financial advice, she understands why some are hesitant. “The truth is that it’s not cheap.”

However, Jodie urges females to weigh up the cost of financial advisory fees against the long-term benefits that smart financial advice can deliver. She explains that financial advisers need a lot of skill and time to analyse a person’s finances, assess their risk profile, and come up with an appropriate plan that factors in a myriad of work, personal and family factors. “People often don't appreciate how much behind-the-scenes work goes into giving you the advice, which is why it can cost a lot.”

Jodie’s investment portfolio is weighted in favour of property and superannuation assets, two areas in which she feels reasonably knowledgeable. “There should be no cookie-cutter approach to investment choices, though. Do what is right for your life circumstances and risk profile”.

A range of factors can see women lag men on the finance front. For example, a gender pay gap often works against females; more career breaks can adversely affect lifelong income and superannuation returns; and a longer life expectancy for women means their money must stretch further in any case.

Getting financial advice can help address these hurdles for proactive women, and increase their chances of acquiring long-term passive income, or becoming debt free sooner.

For other women hoping to improve their financial outlook, Penny Collicoat, Financial Advice Delivery Lead at MFA, offers the following tips:

• Start now – it is never too early to pursue a financial strategy, and acting sooner rather than later will allow you to benefit from compound interest on investments.
• Find a financial adviser you trust – and make sure the adviser has a strong track record and will listen to your financial goals and needs without judgement.
• Do a budget and review it regularly – this can complement your financial plan and maximise your chances of financial security.
• Take ownership of your finances – “and remember that having a man is not a financial plan”.
• Focus on your superannuation – too often, Penny says, people think that super is only for older investors or retirees, and that government rule changes could minimise their super payout down the track. “No one is going to take your super away from you, and if you invest regularly into super over time it will end up paying dividends for now, with potential tax deductions and later in retirement,”. 

With superannuation, Jodie notes that her financial adviser has stressed the importance of maximising concessional superannuation contributions, which may lower overall tax liabilities. Remember, too, that lump-sum super death benefits paid to tax dependants directly as an inheritance are not taxed.

Of course, when selecting a financial adviser, make sure they have the appropriate credentials and come with strong word-of-mouth recommendations.

Jodie says her adviser has been a godsend. As she inches closer to retirement, she draws comfort from knowing that she can follow through on her goals – whether it is painting her house, getting a new car, or jetting off to another country.