Financial disaster is on the horizon for 2 out of 5 self employed people. The reason? Because they have no pension.
This is according to new research, which shows us quite clearly that almost half of contractors, freelancers, gig workers, and small business owners are either not planning for the future or simply don’t have the cash to save for their retirement.
Exactly 43% of those who work for themselves have no kind of pension, compared to 4% of those in traditional employment.
Amazing isn’t it? Especially when you consider that around 5 million Brits are now self employed, which accounts for roughly 15% of the workforce.
However, it appears that most contractors and freelancers are not really that bothered about this self employed pension crisis, with many saying they are going to continue working and not retire.
That’s right. In future years get ready for men and women in their seventies and eighties…still looking for clients and serving customers. No time to put their feet up. They will have work to do.
Others plan to have some kind of retirement, primarily relying on the State Pension, and then doing a bit on the side to top up their earnings.
In my opinion you can’t rely on the Government or the State Pension at all. Sure, right now you get £8,545 a year with a State Pension, but will that kind of cash still be available in 20 years or 30 years time? My opinion is…no.
Also, let’s not forget the Government keep on pushing back the retirement age. In a few years it wouldn’t surprise me if “retirement” comes at 70, and then eventually…75.
If you think a State Pension is going to come to your rescue then my advice would be to think again.
Even though 2 in 5 of you don’t have a pension, that doesn’t mean you don’t know how to save money. On the contrary. According to the research the self employed are savers…just not for pensions.
Instead, that cash is in a savings account and ready to be used for emergencies, with 64% of the self employed having cash stashed away compared to 57% of traditional employees,
Not only that, but only 10% of self employed see a financial advisor on a regular basis, with 19% saying they are not confident about money and 24% admitting they don’t know enough about their finances.
“Time to get educated,” is what I say to all of you reading this blog post. Do whatever you need to do to get it sorted. Learn and then start saving for a pension. It really is the best way in my opinion.