I’m self-employed. Do I need financial advice?

By Rosemary Bigmore

Self-employment brings both freedom and responsibility. Though you have more control over your finances than when you are in a salaried position, there are many things you need to think about to make the most of your new status. Using an independent financial adviser could help you make the most of your money.

  1. Self-employed tax is complex

You may have chosen to operate as a sole trader or to open a limited or umbrella company. Whichever is best for you, you will need to grapple with the tax laws about your business income and how to pay yourself. You also need to ensure you are making the correct national insurance contributions so you do not lose your entitlement to the state pension when the time comes. A financial adviser can help with all of this, ensuring you do not pay more tax than you have to.

  1. Your pension is your responsibility

When you are employed, you usually have an employer contributing to your pension. Many people do not even think about where their workplace pension is invested, leaving the employer to get on with it. But self-employed, you are responsible for your retirement planning and saving for your old age. A financial adviser can help you with a pension plan that makes the most of tax breaks and is invested in assets aligned with your own risk tolerance and financial goals.

  1. You may need help with a mortgage

When you are self-employed it can be more difficult to get a mortgage, as lenders are sometimes nervous about the amount of money you have coming in. A financial adviser can help you navigate the maze of lenders, which have different criteria for lending to the self-employed, as well as ensuring you have the correct evidence in place to prove you are a good loan candidate. Self-employment has considerable rewards and challenges. To make the most of it you will need clear financial goals and to know how you will work towards them. Getting an expert in could make all the difference.

A qualified financial adviser could help you make the best decision for you, taking into account the tax rules and your circumstances as well as your retirement plans.

To find out more about how we can help you achieve your financial goals, call 01732 617950 

It is important to take professional advice before making any decision relating to your personal finances. Information within this page is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.

Tax and Estate planning are not regulated by the Financial Conduct Authority.

The value of pensions and investments can fall as well as rise. You may get back less than you invested.

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