Superannuation - understand its long-term value before you settle.

In a long partnership, superannuation is often the largest single asset — more valuable than the family home when you account for what it can generate over a 25-year retirement. Yet it is consistently the asset women are least likely to pursue at settlement, and the one where they most commonly lose ground.

This is not a coincidence. It is the result of how superannuation works, what it looks like from the outside, and the conditions under which most settlement decisions are made.

WHY SUPER GETS LEFT BEHIND

The family home is visible, familiar, and emotionally significant. You have lived in it. You know what it is worth. You understand what losing it means.

Superannuation is none of those things. It sits in a fund you may have paid little attention to. It is not accessible now. It feels abstract compared to bricks and mortar, and in the middle of a settlement negotiation, abstract tends to lose.

Research by the Australian Institute of Family Studies found that an unexpectedly low proportion of separating couples formally split superannuation, even after the legislation was introduced specifically to make this possible. Women in particular — who typically hold less superannuation — are the ones who most need to pursue it, and most often don't.

The consequences are permanent. Superannuation not claimed at settlement cannot be recovered. There is no going back once the agreement is formalised.

WHAT THE LAW ACTUALLY SAYS

Under the Family Law Act 1975, superannuation is treated as property. It forms part of the asset pool available for division at settlement, in exactly the same way as the family home, investment accounts, or savings. The fact that it cannot be accessed until retirement does not exclude it — it simply affects how it is valued and how the split is structured.

This applies to both married and de facto couples. It covers all types of superannuation interests — accumulation funds, defined benefit funds, and self-managed super funds. And it applies regardless of whose name the fund is in.

Under Australian family law, superannuation earned during a relationship is treated as an asset accumulated through the contributions — financial and non-financial — of both parties. Years spent raising children or managing a household while a partner built a career are contributions the law recognises.

The Family Law (Superannuation) Regulations 2025, which came into force on 1 April 2025, updated the framework for how superannuation interests are valued and split at separation, including updated methods for valuing defined benefit and newer retirement income stream products.

THE STARTING GAP

HILDA survey data from the University of Melbourne's 20th Annual Statistical Report found that in 2023, the typical Australian man entered retirement with more than 1.5 times the superannuation balance of the typical woman. Median superannuation for men aged 60 to 64 was approximately $204,000, compared to approximately $147,000 for women in the same age group.

That gap is not accidental. It reflects decades of lower average wages, time taken out of the workforce for caring responsibilities, and higher rates of part-time employment.

According to the Australian Institute of Family Studies, taking time out of employment to care for children has a significant negative impact on superannuation balances — and this impact persists even when women are more highly qualified than their partners.

These are median figures. For women in higher income households, or where one partner had an uninterrupted senior career, the absolute gap is often considerably larger.

At separation, that accumulated gap becomes a negotiating reality. The party with more superannuation has more to protect. The party with less has more to gain — but typically less information about how to pursue it.

WHY THE NUMBERS AT SETTLEMENT ARE NOT THE SAME NUMBERS AT RETIREMENT

This is the part that most changes the conversation about what is fair.

Superannuation is not a static asset. Every dollar sitting in a fund today continues to grow — through investment returns — until it is drawn down in retirement. So the question is not just what the balance is today. It is what that balance becomes over the years between now and when you actually need it.

The following illustration uses conservative growth assumptions consistent with ASIC MoneySmart guidance. It is designed to show the principle simply — your fund's actual returns will vary.

Illustrative example — accumulation fund value at age 55, with access at age 67
Growth rate (conservative, after fees)	6% p.a.
Scenario A — settlement amount: $150,000	→ $302,000 at 67
Scenario B — settlement amount: $200,000	→ $402,000 at 67
Difference at retirement from a $50,000 difference at settlement	~$100,000

Growth calculated at 6% p.a. after fees, consistent with ASIC MoneySmart conservative assumptions. Illustrative only — actual returns vary. Does not account for tax, fees, or Age Pension interactions.

A $50,000 difference at the point of settlement becomes approximately $100,000 by retirement. That is the difference between an adequate retirement income and a stretched one.

WHEN EQUAL ON PAPER IS NOT EQUAL IN RETIREMENT

There is a version of this that is even more common — and even harder to see at the time.

In this scenario, the total asset pool of $600,000 is divided equally — $300,000 each. He receives his share as superannuation, which stays invested and growing. She receives her share as cash, drawn from other assets — property equity, savings, or a combination.

The dollar amounts are identical. The retirement outcomes are not.

Cash is accessible, which is exactly why it feels more valuable in the moment. It's easy to spend it on rent, on establishing a new home, on the costs of rebuilding a life — and once spent, it's gone. And even when it is carefully invested, the tax treatment outside superannuation means it doesn't grow the same way.

The table below uses the same conservative assumptions to compare what happens to each party at retirement — same starting amount, same settlement, different asset class.

Equal settlement, different asset class — $300,000 each, age 55, access at 67	Settlement	Rate	Value at 67
He keeps $300,000 in super	$300,000	6% p.a.	$604,000
She takes $300,000 in cash → fixed interest	$300,000	4.5% p.a.	$509,000
She takes $300,000 in super instead	$300,000	6% p.a.	$604,000
Gap: cash vs super at retirement — same starting amount			$95,000

Super growth at 6% p.a. consistent with ASIC MoneySmart conservative assumptions. Fixed interest at 4.5% p.a., consistent with current Australian term deposit rates. Both parties receive $300,000 — a genuinely equal settlement in dollar terms. Illustrative only — actual returns vary. Does not account for tax on investment income outside super, fees, Age Pension interactions, or drawdown strategy.

The settlement was equal. The retirement outcome is not.

Starting from exactly the same amount, she arrives at 67 with $509,000 if she took cash and invested it carefully. He arrives with $604,000. The $95,000 gap between them was not created by an unequal split. It was created by the choice of which asset each party took.

Had she taken her share in super rather than cash, they would arrive at retirement in the same position. That is the difference a single structural decision makes, compounded over 12 years.

A settlement that is equal today can produce a retirement that is not. The asset class matters — and the difference compounds over every year between settlement and retirement.

HOW TO FIND OUT TOTAL SUPERANNUATION BALANCES

One of the most common obstacles to claiming superannuation at settlement is not knowing what the other party has. Since 1 April 2022, parties to family law proceedings can apply directly to the court to request that the Australian Taxation Office disclose their former partner's superannuation information. The ATO holds records of all superannuation accounts reported to it and can provide the fund name, account details, and balance for each account held.

According to the Federal Circuit and Family Court of Australia, this information is typically provided within seven days of the request. It can only be used for the purposes of the relevant proceedings.

Once funds are identified, the most current balance is obtained by completing a Form 6 declaration from the court's Superannuation Information Kit, submitted directly to each fund's trustee.

HOW SUPER IS SPLIT — AND WHAT THE OPTIONS ARE

Splitting superannuation is not the same as splitting cash. The non-member spouse receives a separate superannuation interest, subject to the same preservation rules as any other superannuation account, generally only accessible at retirement.

There are two ways to structure the split: by a specific dollar amount (a base amount), or by percentage. The choice affects how the interest grows between the date of the split and the date it is accessed, and is worth understanding before any agreement is reached.

Accumulation funds

The most common type. The value is the current account balance as shown on a recent fund statement. The growth illustrations above apply directly to this type of fund.

Defined benefit funds

More complex, and more commonly undervalued. A defined benefit fund pays a benefit based on a formula — typically years of service, salary, and a fund-specific factor — rather than a simple account balance. What appears on a statement is often a notional figure. Because the benefit is calculated on final salary and years of service, the actual value at retirement — particularly for long-serving members — can be substantially higher than anything shown on paper today.

These funds must be valued using methods approved by the Attorney-General under the Family Law (Superannuation) Regulations 2025. In many cases this produces a value significantly higher than the account balance alone. Accepting a cash equivalent without proper valuation can mean accepting considerably less than the fund is worth.

A financial planner or family law solicitor with superannuation expertise can model the specific difference for your fund. This is one of the most important questions to have answered before any settlement involving a defined benefit fund is agreed.

Self-managed super funds (SMSFs)

Where one or both parties are members of an SMSF, the split has additional complexity. The fund's trust deed determines what is possible. Super splitting may require the SMSF to be restructured or wound up. Independent advice is essential.

WHAT IS WORTH ASKING — BEFORE ANY AGREEMENT IS REACHED

A few questions worth having answered independently before any settlement is finalised.

What superannuation exists — in both names, and in all funds? The ATO pathway can establish this if there is any uncertainty.

Is what is being offered super, cash, or another asset — and what is the long-term difference? The illustrations above show why this question matters.

What type of interest is it? Accumulation, defined benefit, and SMSF each require different approaches to valuation.

What is the long-term value of the proposed split? A financial planner can model what a superannuation interest is worth at 67, at 75, and beyond — in actual retirement income, not just as a balance today.

Is the proposed settlement fair in the context of the whole retirement picture — not just the dollar amounts at the point of agreement?

ONE LAST THING

Superannuation is the asset most likely to shape your financial life in retirement, and the one most likely to be undervalued, overlooked, or traded away for something that feels more real in the moment. The research supports this. The law provides for it. And the consequences of getting it wrong are permanent.

If you would like a personal introduction to a family law solicitor or financial planner who can help you understand your superannuation position clearly — before any numbers are on the table — that is exactly what I am here for.

REFERENCES

1.  Attorney-General's Department. (2025). Superannuation splitting. Australian Government. ag.gov.au/families-and-marriage/dividing-property-finances-and-superannuation-after-separation/superannuation-splitting

2.  Attorney-General's Department. (2025). Family Law (Superannuation) Regulations 2025. Commenced 1 April 2025. Updated valuation methods and information-sharing framework for superannuation splitting at separation.

3.  Federal Circuit and Family Court of Australia. (2025). Visibility of superannuation for property settlement proceedings. fcfcoa.gov.au/fl/fp/super-visibility

4.  Federal Circuit and Family Court of Australia. (2025). Family law (property) changes from 10 June 2025. fcfcoa.gov.au/news-and-media-centre/fla-changes/fla2024

5.  Australian Taxation Office. (2025). Superannuation and relationship breakdown. ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/superannuation-and-relationship-breakdown

6.  ASIC MoneySmart. Superannuation calculator. Growth rate assumptions consistent with MoneySmart conservative long-term guidance. moneysmart.gov.au/how-super-works/superannuation-calculator

7.  Laß, I., & Peyton, K. (2025). There's still a gender gap in retirement. 20th Annual HILDA Survey Statistical Report. Melbourne Institute of Applied Economic and Social Research, University of Melbourne.

8.  Australian Institute of Family Studies. (2000). Superannuation and divorce in Australia. Research findings on the low proportion of separating couples who formally split superannuation.

9.  Sheehan, G., Chrzanowski, A., & Dewar, J. (2008). Superannuation and divorce in Australia: An evaluation of post-reform practice and settlement outcomes. Journal of Social Welfare and Family Law, 22(2), 206–227.

10.  West, T., & Mitchell, E. (2022). Australian women with good financial knowledge fare better in divorce. Australian Journal of Social Issues, 57(1). HILDA survey data on financial literacy and long-term wealth outcomes for women post-divorce.

11.  Super Members Council. (2025). Mind the gap report. SMC analysis of ATO 2% sample file 2022–23. Women retire with approximately $50,000 less superannuation than men.

12.  Australian Institute of Family Studies. (2024). Paid parental leave super a welcome move. On the impact of caring responsibilities on women's superannuation balances.

13.  Family Law Act 1975 (Cth), Parts VIIIB and VIIIC. Governing legislation for superannuation splitting in Australia. Amended by the Family Law Amendment Act 2024.

Disclaimer: The information here is general in nature. It does not constitute legal, financial or professional advice, and it is not tailored to your individual circumstances. Where your situation is complex or the stakes are high, speaking with a qualified professional is likely to be worthwhile.

HerBestMoveNow · herbestmovenow.com.au  ·  © Her Best Move Now 2026