Tax & admin · 31 July 2017

Large proportion of self-employed only just about managing? to keep finances in check

Serious young African woman holding eyeglasses while standing in her workshop
Just 11.5 per cent of respondents claimed their finances were “comfortable”
Almost two-thirds of Britain’s self-employed workforce describe their financial situation as just about managing? or worse, according to new survey findings that confirmed thecash flow disadvantages of small business owners.

In a nationwide study of 3, 000 workers, undertaken by financial advisory firm Drewberry, the UK’s self-employed were found to have fallen behind regular employees in terms of earnings, personal pension savings and insurance provision.

With a significant minority of 11.5 per cent citing their finances as comfortable, many self-employed workers were found to be struggling at the other end of the spectrum. Some 13.5 per cent said finances were hanging by a thread, while 1.9 per cent claimed their accounts were in in serious trouble.

A strong disparity in living expenses between the self-employed and regular employees was also uncovered by the research.

At over seven in ten, the self-employed were twice as likely than full-time counterparts to have just 200 or less to spend each month after meeting basic living expenses.

money is now so tight for most self-employed professionals, said Tom Connor, director at Drewberry.

today, the average self-employed Briton has far less discretionary income available each month than their employed counterparts, he added, with over 70 per cent of self-employed respondents currently having 200 or less a month after meeting their regular outgoings.

this explains why almost two out of three self-employed Britons now describe their finances as just about managing? or worse.

Warning of growing pressures facing self-employed workers, Connor cited the Uberisation? the UK employment market.


 
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ABOUT THE EXPERT

Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.

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