Sole traders exposed to cash crisis

Nearly half (41%) of self-employed people struggle to save any money each month, leaving them exposed to financial problems.

A survey of 9,495 self-employed workers has revealed the top financial concerns which are worrying small business owners. The research was carried out by insurer, LV= and found that:

• One in three self-employed workers wouldn’t be able to survive for more than three months if they lost their income.
• Nearly two thirds (62%) find that bills eat up the majority of their wages.
• Sole traders are more likely to be hit with unexpected costs (33%), such as home maintenance and repairs, compared to the national average of 28%.
• Nearly half (41%) of self-employed people struggle to save money each month – making it difficult to cover unexpected costs and make payments to HMRC on time.
• 28% of sole traders are concerned about not being able to work due to an accident and 29% are worried about what would happen if they became unwell and couldn’t work.

Justin Harper, head of protection policy at LV=, said:

“It’s often the case that self-employed people lack the safety net of an employer’s benefits, such as sick pay. This means they risk having to rely instead on state benefits, which can involve a lengthy application and wait with no guarantee of any support.”

If this is something which affects you and you’re looking for accountants in Camberley, please feel free to contact us and we can help.

Income protection

In circumstances where you are unable to work, there are protection policies available to help cover your costs.

Income protection pays out a tax-free percentage of your earnings, usually between 50% and 70%, until retirement, death or your return to work.

If diagnosed with a long-term illness or disability, critical illness cover can pay you a tax-free lump sum to cover your expenses.

If you’re looking for accountants in Camberley and would like to discuss your personal finances and what should happen if you can’t work, please feel free to contact PKB and we will be more than happy to help.