News

The biggest financial mistake women are making according to an economist

We all know the story: women earn less than men. But even as society and employers work towards closing the gender pay gap, there’s another inequality that women face that’s just as crucial to building their wealth: the investment gap. 

Why women are not investing their money 
According to CoreLogic's 2025 Women & Property report*, Australian women are underrepresented when it comes to investing, with 40% of women reporting not having any investments, compared to 27.8% of men.
AMP’s Deputy Chief Economist, Diana Mousina says it’s the biggest financial mistake she sees women making today. You can see this from a high school age, going to uni and then going into the workforce. Women tend to be more risk averse and they don't tend to be as into investing and making those investment decisions. 
That is not a bad thing. There have been studies that show female portfolio managers who manage investments for clients smooth performance out, for example. But from the financial literacy bit for everyday women, it dampens the age that they get into investing and become more interested in it.

Why women should be investing
We know that time in the market equals money, because of the way that compound interest works. 
Compound interest refers to the way returns compound on past returns for an investor over a long period. Essentially, it’s your money making more money, which then makes even more money – like a financial snowball rolling downhill, getting bigger and faster.
Investing doesn't have to mean you need thousands of dollars to invest into the share market or into some sort of asset. It can be as simple as investing in $200 and building on that into the future. 

How to start investing
The best way to start is with a budget. Make a financial plan and figure out how much additional spare cash you have for investing. 

Investing can be in so many assets: housing, shares, superannuation. Even if you don’t have any additional cash right now make sure you are happy with your super fund and understand which portfolio you are invested in. You can also salary sacrifice into your super to help grow your balance even faster.

The way that we can invest now is so much more accessible to everyone. You can do it on your smartphone. There are so many platforms that you can use. And it can start from a very small amount. 

*Source: CoreLogic's 2025 Women & Property report

Source: AMP
 

Caring for ageing parents

Some of us may help provide assistance to our ageing parents or other relatives in the future. That time may bring a range of emotional and physical challenges. Planning ahead may help relieve stress down the track. Here are three suggestions that may make a difference.

Talk about your parents’ future
It may not be an easy discussion, but knowing what your parents want can help later. Ask them about the type of care and living arrangements they want. Find out about the different types of care they can afford. Think through whether you will be able to physically and mentally offer the support they require. This is an important but often overlooked consideration.
It also helps to establish trigger points. Being unable to manage a garden or a dementia diagnosis and clear signs of memory loss may be time to change care arrangements. This process is about helping your parents to state their wishes while they still can. They can also take this information to specialists, such as their financial advisers, accountants and lawyers. Knowing this information can also help you plan ahead if you need to offer financial support.

Setting up a power of attorney and enduring guardianship
You never know what circumstances life may send your parents’ way that mean someone else needs to take care of them or their finances. At some point, some of us might not be able to go to a bank or make an informed decision about our care. Which is why appointing a power of attorney and setting up enduring guardianship documents can be important.
This is a trust relationship, and your relatives should carefully consider the right person to appoint. It’s also important not to leave this until it's too late. It’s difficult for someone suffering from mental deterioration to provide informed consent about changes to their finances. Setting up these documents before problems arise can protect ageing relatives and their families.

Establishing clear records of finances and assets
Finances and assets are a sensitive topic, which could be tough to discuss. This is understandable, but you can still help them plan by encouraging them to set up clear records of what assets or debts they have, as well as contact details for institutions they use along with details about any financial advisers, accountants, lawyers and other specialists with which they have relationships.
Having clear documentation can also help down the track. For example, it can ensure any debts are attended to and avoid unexpected debt collection notices for bills that would have been covered at the repayment time if you’d known about it. Or it can help to identify funds to cover medical expenses or nursing care when needed.
Being prepared can offer you and your relative's confidence about their options for whatever the future brings, even if it feels confronting at first. It can also make difficult times a little less challenging. There is a range of tools offered by state trustees and government websites like MoneySmart to help with budgeting and estate planning. Speaking to financial advisers and lawyers can also help.

Source: BT
 

When can you access your super?
Super is only for when you retire, right? Well not quite. There are a few times in life when you might have a valid reason to get hold of some of your super savings.

When is it time to access your super?
Super is your savings for retirement. So it makes sense that there is an age you have to reach to get access to the funds you’ve saved. 
When you reach what we call your preservation age, you can access your super if you permanently retire. From 1 July 2024 this is age 60 for everyone.

So you’re old enough, now what?
Once you’ve celebrated your 60th birthday, there’s another box to tick before you get access to your super. We call this a condition of release and leaving the workforce for good is one of these conditions. So if you retire for good after reaching your preservation age, you can get your hands on your super.
If you change jobs on or after turning 60, you can continue to work and also access your super. Or you can wait until you reach age 65 and access your super, even if you’re still working. 
If you become totally and permanently disabled before your preservation age, you’ll also be able to access your super.  

Can you access your super before age 60?
Yes. But the Federal Government has very strict guidelines on when and why you can access you super early.
There are some other circumstances where you can apply to the Australian Tax Office to access a limited amount under compassionate grounds from your super before retirement, when you are in need of financial help to:
•    Stop you from losing a home you own because you can’t pay the mortgage.
•    Cover the cost of medical treatment, palliative care and/or disability services for you or a dependent. 
•    Cover the cost of a funeral or burial arrangements for a dependent. 
You can also apply to your super fund for early access if you:
•    Are experiencing severe financial hardship, can’t pay basic expenses for you and your family and have been paid income support benefits like JobSeeker continuously for at least 26 weeks.
•    Have a terminal illness.
•    Become incapacitated, either, temporarily or permanently.

Is it a problem to access super early?
Any amount you take from super now is less money for when you retire. Of course, if being short of money is forcing hardship and stress on you now, and you have a legitimate reason to access your super, withdrawing an amount to take the pressure off makes sense. But it’s a good idea to get information on your other options before taking this step.

Can I really access my super to pay my first home deposit?
Yes you can. The First Home Super Saver Scheme (FHSSS) could see you on your way to owning your first home sooner:
•    You can only access any extra payments you have made into super for the purpose of saving for a home loan – and also investment returns those extra savings have created. 
•    You can keep these payments in super until you’re ready to buy.
•    While you do this you can be saving on tax – both on the money you’re earning from investing your super savings, which is taxed within super at 15% and from the tax you could save by making extra payments into super from your pre-tax salary – these are called concessional or salary sacrificed contributions.
•    Regular payments into super help you save.
•    Your super may earn better returns than a bank account.

Source: MLC
 

Seven secret financial habits of wealthy Australians you can copy

Ever wondered how the wealthy manage their money and what they do differently from the average Australian? New research* from Colonial First State (CFS) has uncovered seven secret financial habits that will help you build wealth.

How do well off Australians create and maintain their wealth? From CFS’ research* over the past two years, there have been seven financial habits identified that set the well heeled apart from the crowd. 
These habits are the financial equivalent of good dental hygiene. But while most kids are taught about oral health, many Australians are left in the dark when it comes to managing their money.
The value of the assets, investments and savings of the relatively wealthy averages around $3.746 million, the data shows – over five times as much as that of the average Australian, at $651,000. 

Here’s what you can learn from them.

1. Know the goal... and how to get there
Wealthy Australians are more likely to set clear financial goals including what they want to achieve and by when.
The research indicates 92% of affluent investors are more likely to have identified the age at which they want to retire, compared with 83% of the general population.
They’re also more likely to set lifestyle goals and review them to ensure they’re on track. For example, four in five specifically aim for a comfortable or even a luxurious retirement that enables them to travel and eat out – something less than one in two of us do on average. 
This clarity and preparedness are important in helping them to maintain their standard of living without financial stress, allowing them to travel, enjoy leisure activities and look after themselves as well as their family.
In fact, four in five wealthy individuals say they feel prepared for retirement, compared with just two in five of the general population. 

2. Think long term
Planning for the long haul is another hallmark of the well to do. They are more likely to plan for the future, with 93% thinking long term compared with 87% of the average population. 
This forward thinking approach helps them make informed decisions about their investments and retirement savings. 
They’re also 50% more likely to seek help to identify different ways to invest their retirement savings than the general population. 

3. Have a thirst for knowledge
A desire to educate themselves about money is another defining habit of the well off. They’re almost twice as likely to rate themselves as having a very good or excellent level of financial literacy.
They’re also generally more interested in getting help to set financial goals, with 81% seeking help compared with 70% of the average population. 

4. Seek financial advice from professionals
Wealthy Australians are more likely to get help from a financial adviser and to talk to them regularly.
The research shows 45% of the well to do have an adviser – more than twice the proportion within the general population. Of those who have an adviser, 47% have spoken to their adviser in the past six months and 61% in the past year. 
This regular communication helps them feel more prepared for retirement.  

5. Get involved with super
Affluent investors are actively involved with their super. They are much more likely to regularly monitor how their super performs, with 82% doing so compared with just 20% of the population at large.
They are also more likely to actively compare the performance of their super fund against competitors, with 49% doing so compared with 32% of the average population. 
And they’re more likely to review how their super is invested to ensure it meets their needs. This active involvement ensures they can make adjustments as needed to help them stay on track to meet their financial goals.

6. Know how assets are invested
Perhaps because of their financial knowledge, wealthy people have a more detailed understanding of how their wealth is invested, and the rate of return and risk profile of their chosen investment options. 
While one in three Australians on average don’t know how their money is invested, that figure falls to 9% for these individuals.

7. Invest outside super
Finally, affluent investors tend to have investments outside their super. They are much more likely to have a diverse portfolio, with 94% having other investments compared with 56% of the general population. 
The most common investments they hold are shares, owned by 51%, and high interest savings accounts, held by 43%. 
They are also more likely to have a range of different investment types, also including things like term deposits and even crypto currencies.

This diversification provides them with security and helps them spread their risk across different asset types. 
These seven habits of the relatively wealthy are good lessons for any investor and worth considering if you're looking to improve the value of your own investments and personal wealth.

Source Colonial First State