Why Poverty Stalks Women in Retirement

There’s been gloom hovering over Australia’s A$2 trillion property sector recently. Inflation continues to be a huge issue, and it responded by abruptly ratcheting up interest rates even as real wages are falling well behind.

Still, sales are staging a coming back as savvy property investors pick up bargains. Smart investors recognise opportunity when they see it while many are confused by the turbulence.

Women Are Increasingly Investing In Property

According to the Australian Bureau of Statistics (ABS) 15.7% of Australian taxpayers own an investment property. A majority of property investors have an average net income under $100,000 with 45% of investors skating by on less than $50,000 per year.

However, the percentage of women investors owning property is a true transformational shift. ABS data shows women comprise nearly half (47%) of all property investors, up from a depressing 20% in the previous decade, suggesting buying a property is within the financial reach of many women.

Confronting The Possibility of Poverty After Retirement

We are seeing more women facing potential poverty in retirement. The gender differences in pay and superannuation disadvantages, actively work against women.
Analysis by CoreLogic back in 2021 suggests women own less property than men. CoreLogic also found that the gender pay gap widened during that time.
That means women need an average of 91 months to save a 20% deposit on the median dwelling value compared to a spritely 79 months for men.

Why Is This So?

A widening gap currently exists between the balance of superannuation accounts of Australian men and women.

Australia’s superannuation model actively works against women in the workforce who are more likely than men to have their careers disrupted by parenting and caring for their families. Women are also more likely to find themselves in casual and part-time work.

Little wonder then that research from the Workplace Gender Equality Agency (WGEA) shows greater numbers of elderly women than men are living in poverty. Similarly, WGEA’s research shows women are twice as likely as their male counterparts to move to lower-cost accommodation when faced with financial constraints.

Poverty Stalks Women In Retirement

One statistic worrying many researchers is the rising number of older women who are renters. This figure was over 180,000 in 2016, double the 2006 level of 90,000 women.
According to an August 2020 report by Social Ventures Australia and HAAG the number of at-risk older Australian women potentially facing homelessness is a terrifying 405,000 women!
Poverty is the root cause of this alarming statistic.

What To Do?

Women experiencing homelessness need long-term, affordable housing that is appropriate for their needs. Stable housing is important to ensure good mental as well as physical health. A sense of well-being is a human right.

Women’s health requirements typically increase as they age and can be exacerbated by homelessness.

Older women generally have modest needs and require little more than a safe, affordable, permanent residence to call home.

Act Now!

These predictions of a bleak retirement should be enough to motivate women of all ages to do their best to seriously look at building a property portfolio. Even buying a single property can make a huge difference to your future financial future.

Women want to take charge of their financial futures now. Young women are increasingly confident in their ability to build long-term wealth. And savvy property investments are playing a part in their financial plans.

Final Observation

No one ever thinks poverty or homelessness will happen to them. Happily, getting into property, either by buying their own home or rentvesting, will provide them with a fallback position later in life, ‘poverty proofing’ their future.

Julie Crockett
CEO and Founder of Australian Property Investment Solutions