Which is jac and which is sar? *thinking face*

Happy International Women’s Day! There’s a lot to celebrate, and I genuinely believe we’re making significant and important progress around the world.

The premise of the United Nations’ IWD is Women in the Changing World of Work: Planet 50-50 by 2030. So as I put on my Debbie Downer beret 🎓, there’s a lot to be dissatisfied about, a.k.a. a lot more work to do. No country has achieved gender equality yet. The good news? We’ve started our journey, and we’re going to tear it up 💪.

Pay attention

Most of us probably know about the pay gap— women earn less money. A lot less, in almost every environment. Understanding the gap’s root drivers is crucial for future progress. But it’s also crucial that we recognise its flow-on impact.

The big cheese

The pay gap is just the beginning of a measurable divide, like the end of a wedge of parmesan 🧀. What is rarely discussed is the gender gap in savings, and the further gender gap in investing. Because of these, over time, we end up with a money gap that’s more a yawning chasm. The rind end of the parmesan. And it’s pretty tough to chew on 😷.

A clear reflection of this is in retirement. One in three women have zero superannuation, while 40% of single retired women live below the poverty line. Women retire with less than half the super of men. This is directly linked to earnings, but the problem is more complex.

How it begins

Despite making up the majority of university graduates, women are paid up to 8% less than men as soon as they start working. That means immediately, our ability to save is hurt by lower earnings.


Paid less? What the what now?


Suncorp found that women under 34 save almost a third less than men on a monthly basis, and according to Commonwealth Bank, a key barrier to savings potential in millennials is lack of income.

Mind the gap

Over time, this earnings gap widens, and kicks up a gear when women have children. Taking a break from paid work as a primary caregiver, or working part-time obviously impacts your earnings. But KPMG and the Diversity Council of Australia have found that biggest single factor in the pay gap is actually gender discrimination.

On average, women earn $700,000 less than men in their lifetimes. In university graduates with equivalent degrees, a man will earn 1.8 times more than his female counterpart.

So it becomes clear how that savings gap can become immense.



Invest, don’t rest

To snowball that difference in savings, there’s another gap, this time in investing.

Women are more likely to put savings into cash or term deposits rather than shares or bonds. Women are also less likely to actively allocate their super. Yet when women do invest, it turns out they make better investment decisions and make more money.

☃️ Going back to the snowball effect, by not investing we’re not only eroding our savings from the impact of inflation ($100 today isn’t worth $100 tomorrow as stuff gets more expensive), but also missing out on the🌟magic🌟 of compounding. If you can bear the risk and have a longer-term horizon, it can make a bigger difference in the long run than even upticks in your earnings.

Hey big spender

On top of that, women make the majority of spending decisions. Not all spending is bad spending, but if you take a day noticing the noise and advertising on our phones, on websites, and billboards, it’s clear that women are constantly being primed to spend, and mostly on crap. Men are too, but that’s mitigated to some degree by relatively higher earnings and financial engagement.

Stop defining me

The roots of these gaps start well before getting our first paycheck. There are so many entrenched social biases and structural mechanisms that it’s hard to know where to begin. But it starts early. In children as young as six, a gender gap already appears in numeracy, and it is linked to pressure to conform to gender norms. Men=STEM, women=humanities. That’s unfair for women and men. Those deeply limiting social norms continue into adulthood, with wealth and financial literacy characterised as masculine attributes.

Money matters

We’ve talked about how money is a basic driver of happiness 🤑. This isn’t to say that having a private jet for the private island will make you happy 🏝. What it does refer to is a basic human right: the freedom to choose.

Financial independence increases your ability to say goodbye to a horrible boss, to take that dream job that pays peanuts, or to walk out on a bad relationship. A lack of financial independence results in fewer choices, potential entrapment, and increasingly, deep anxiety. This is the crux of the financial gap. Women are more likely to be bound by financial inequality.

What can we do?

This is everyone’s responsibility— the government, employers, financial institutions, our communities, and on us as individuals to make some noise.

There are little things we can do with our money lives that will become big things over time.

Like, keep pushing for that pay rise. Benchmark against salary surveys online like Glassdoor, talk to your industry peers and talk to recruiters. Don’t feel guilty and negotiate hard. Start talking about money with your friends and colleagues so it’s not this ridiculous taboo. Talk to your managers and HR about the pay gap and ask them to articulate their view and commitment to closing it.

Next stop, identify your savings goals and start going for them. Pay off expensive debt if you have any, from credit card to car loan. If you got that pay rise, try not to spend any more than you did last year. Sweep that earnings uptick into your savings. And check yourself when you see that ad for a new perfume. Will it really make you happy?

Once you’ve started saving and know your goal/s, think about your risk tolerance relating to your goals. Leave that lack of confidence at the door, and really consider investing. As a start, take a look at your superannuation and move your money into low-cost funds.

Yes, we know that all of what we’ve suggested is tough, complicated and boring. We’re working on it, and we’ll be covering the different steps in upcoming posts so they’re easier to tackle.

In the meantime, leave us a note or email us about what you want help with most. Let’s close that gap!


6 thoughts on “The money gender gap

  • Thanks for this article. I’d love to learn more about investing, please — how to go about it, how to manage investments without using a financial adviser, the different options available outside superannuation. Thanks! Nicola

  • Thank you for quality articles that inspire talking about money and investing. I just would love some direction of where to either gain information and confidence to dive in to investing.

  • You guys are awesome. Was wondering if you could talk a bit about ethical investing and banking/super. I want to invest a bit of money in something like innovation/tech or clean energy and don’t know where to start. I also like the idea of using super funds and banks that invest ethically. Is this not as good for your bank balance??Thanks 🙂

  • Some hard truths in this article – especially the point about most if not all advertising geared towards women spending, and that women generally don’t put money into shares or stocks – these are the kinds of things that do add up in the long term, if added to of course, the disparity in salaries between men and women, child-rearing, and so on. So much to think about.

  • I would like to learn more about the risks involved in investing. After working hard to save a nest egg I keep it in a term deposit not earning terribly much at current interest rates because I’m terrified of losing it in a poor investment.

    BTW- I like your point about checking yourself before you respond to a new perfume ad. I read an interview with Helen Mirren recently who advised younger women not to buy that Prada handbag but to get a cheap one from H&M and put the money in the bank instead. I shudder to think about how thousands of dollars I must have spent over the years on expensive beauty products and fashion that would have been better in the bank or sunk into an investment!

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