Nick Bruining: The math shows women are getting a raw deal in retirement, but there is a quick and easy fix

While spouse splitting and recontribution strategies go some way to restoring the gender imbalance, it’s only when you consider the entire retirement income position that the inequalities really stand out.

Let’s start with the basics — how long you’ll need the money for.

According to the government’s life expectancy tables, a man who has managed to reach the age of 60 has, on average, another 24.47 years to live. A woman of the same age has another 27.35 years.

While it’s sobering to know when the government thinks you’ll peg-out, at least it gives you a high-five moment to aim for.

The point here is that a woman who reaches 60 will, statistically, live 2.88 years longer than her male counterpart.

Look in any aged care facility around you, you’ll discover the gender imbalance for older people is alive and well (pardon the pun).

Our senior gal needs money to live off.

According to the Association of Superannuation Funds of Australia, a single person living a no-frills so-called “modest lifestyle” currently spends $33,386 a year. A couple in the same position spends a combined $48,184 each year.

The math here shows that the single’s cost of living is 69.3 per cent of a couple’s.

Here’s the rub.

When we look at the full rate of the age pension, the fortnightly amount of $1149 for a single pension compares to a combined $1732.20 of age pension for a couple. The single rate is 66.3 per cent of a couple.

In a nutshell, women need to survive longer on an income that is less than they need.

There’s more in-built penalties in Centrelink’s means-testing system for being a woman, based simply on life expectancies.

The single pensioner asset means test reduction kicks in at $321,500, whereas for a couple it starts at $481,500 — again at 66.8 per cent of the couple’s level.

The income test threshold of $218 for singles is 57.4 per cent of the $380 a fortnight for couples.

And, as expected, the average super fund balance for a 60-year-old woman is about 80 per cent of the balance for a man who is the same age.

Governments of both sides have taken great credit arguing for gender equality over the years.

It’s about time some realistic measures were taken to ensure the imbalance was fixed.

A starting point would be to make some realistic reforms that allow couples to balance up their retirement nest eggs without having to navigate a complex maze of rules and regulations.

It should be simple to transfer a significant amount of super from one member of a couple to another.

Nominate an amount, verify the partner, tick a box and it’s done.

How hard can it be?

Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association