Here we are at session number 95, and we’re going to be covering some basic financial advice for the self-employed. According to latest figures from the Office of National Statistics, there are 4.6 million self-employed workers in the UK, or 15% of the total working population and that’s the highest proportion there has ever been. But what are the financial implications of being self-employed? Stay tuned…

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Introduction

With so many self-employed people in the UK, it’s clear we are an entrepreneurial nation. But the stats from the ONS also show that many self-employed people may have become so because they had little choice because they couldn’t get work elsewhere. And they show that many self-employed people are earning less – the average weekly wage for s/e is less than half that of employees – and of course they have no holiday pay or sick pay.

So what are the things that self-employed people need to think about when it comes to their finances? Well today I’m chatting to my good friend Annie Shaw who is a finance journalist and financial agony aunt for Saga. And not only does she know what she is talking about, she is living it because she operates as a freelance journalist.

Below are the questions I asked Annie; for the full transcript hit the button…

Questions I Asked Annie

• Who are you, what do you do and how did you end up doing it?!
• Can you define what it means to be self-employed?
• Tax is likely to be an issue for self-employed people because it isn't being done for them. Can you explain how it all works?
• How is the tax calculated and when is it paid?
• Also, what about National Insurance? And VAT?
• As well as not having your tax and NI worked out for you when you're self-employed, there are other things that newly self-employed people might not think about. Sick pay, for example. Can you elaborate?
• I imagine there are other insurances to think about too?
• What about pensions? Lots of employers offer these, but should self-employed people bother
• Won't they need to save more if there's no employer contributing?
• It's all very well talking about pensions and insurance, but what if I'm having a thin streak and there's less money around? Can I stop these and restart?
• Anything else our intrepid freelancers need to think about?

Summary

Hope you enjoyed that; Annie is great isn’t she?! You can hit her up on Twitter at @cashquestions.

If you have any questions about anything we’ve talked about today, leave a comment below and we’ll answer them for you. And Rachel, who originally asked this question on the MeaningfulMoney Facebook page, thank you!

Next Session Announcement

Next time we'll be talking about How to review a portfolio. What are the things you should be looking for when sitting down to review your investments and pensions? I’ll reveal all next week…

If you have a question on this subject, or any other financial query that you want answering here on the show, then the best way to do that is to leave me a voicemail at meaningfulmoney.tv/askpete