Solutions to older women falling into poverty

News Release - Thursday 15th October

Initiatives to improve financial literacy and numeracy, a review of the labour force participation of older women and more secure tenure of housing were three of the main focus areas identified at a forum in Adelaide to identify solutions to challenges facing older Australian women.

The strategies proposed at the forum may form the basis of a collective submission into the Senate Standing Committee on Economics inquiry into ‘Economic security for women in retirement.'

Participants of the forum, hosted by SA independent living and aged care provider ECH Inc in conjunction with COTA SA, agreed that comfortable retirement is difficult in Australia and that as a nation we are facing increasing numbers of older women falling into poverty. The event attracted SA business and political leaders, academics, financial service institutions and aged sector service providers and agencies.

Subject matter experts, Professor Hazel Bateman, Head of Risk and Actuarial Studies, University of New South Wales and Professor Wendy Lacey, Dean, Law School, University of South Australia presented to the group.

Dr David Panter, Chief Executive Officer at ECH Inc said the focus of the forum was to deliver initiatives to address the key areas that are contributing to a large number of women falling into poverty in old age.

"Women who are single or have experienced a divorce and the division of assets (including the family home) often have reduced financial and housing security," added Dr Panter.

"Women are also systematically underestimating their life expectancy. As a result, they are not making adequate provisions and often outlive their superannuation.

Solutions discussed at the forum included the identification of employment opportunities for older women. Many women are living to 85 years and over and are spending a significant part of their lives officially retired but able to work. Increased employment opportunities, recognition of the skills older women possess and greater employment flexibility were also proposed.

The need for more stable and appropriate housing was also discussed as many women, especially those who become divorced or separated, find themselves in rental situations with very little if any security of tenure. Homelessness among older people is an ever-increasing problem in Australia.

One of the most urgent interventions proposed was the need for financial literacy and awareness among older women. Older women, generally, have significantly lower financial acumen and do not understand financial products and how much funding they require for adequate quality of life.

In general, women have much less superannuation funding than men. The average amount men have available is $197,000 and only $105,000 for women. These amounts are artificially inflated by some very high accounts. The median amount for women is actually less than $30,000, compared with men of $75,000. Women have less super because of their work histories and opportunities available to them.

Jane Mussared, CEO of COTA SA says the proposals will assist in making a considered response to the national inquiry into Women's Income Security in Retirement, ensuring it reflects the challenges that lay ahead in SA, including for those in regional areas and from diverse backgrounds.

"We urge the State and Federal Governments to measure the labour force participation of older women as our state looks to new industries to replace those we are losing through the manufacturing sector," Ms Mussared said.

"We will be following up the agencies who were part of the working lunch in three months to understand what they are doing differently, what they are noticing and what else should be done to ensure this remains on top of the agenda," added Ms Mussared.

"The outcomes of today's forum have the potential to create long-term solutions to the complex issues facing the current generation of older South Australian women, and protecting future generations from facing the same dilemma," Dr Panter said.

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