Many adults understand the need for financial resilience and taking out insurance to protect their incomes in case of sickness or accident. However, too many self-employed people do not have any cover to help them should they be unable to work and are increasingly likely to choose to carry on working despite illness or injury.
New research has identified that 17% of self-employed individuals stated they would need to continue working if they suffered from illness or injury. Despite this admirable effort, it is important that those who are ill or injured take time off for recovery in order to ensure a safe and sustainable working environment.
Taking time off to rest and recover after an illness or injury can be beneficial in the long run, as it allows workers to return to work with renewed energy, and improved concentration and productivity levels. It also helps to reduce the risk of further health complications or accidents due to fatigue or strain.
Millions of self-employed individuals would be forced to keep working in the event of an illness or injury, according to the research. The findings show 60% of self-employed workers would draw from their savings if they were unable to work for two months, and only 6% of self-employed workers surveyed have purchased an income protection product themselves.
The data shows that many self-employed individuals rely on their savings without considering how quickly these funds could dry up, potentially leaving them unable to pay their rent or mortgage after a couple of months. One in five self-employed workers said they would rely on their partner’s income or savings if they were unable to work.
Worryingly, 19% would struggle to pay their mortgage or rent if unable to work for two months due to illness or injury, and 11% would resort to taking out a loan, using an overdraft or credit cards.
Protection and financial resilience are an integral part of personal financial planning, so it’s important to obtain professional advice before selecting the most suitable policies. For many, this can be an overwhelming concept to tackle when establishing a personal financial plan.
Taking the time to understand the various components involved in building a resilient financial future is informative and essential for those looking to protect their assets and wealth. From understanding the basics of insurance policies to tax regulations and retirement planning.
Protection is about more than simply buying an insurance policy, it’s about ensuring you are supported financially if you are no longer able to work or become ill.
If you have any concerns or would like to find out more, Pierce partners with Pareto Financial Planning on 0161 819 1311 or email Marcus Pilkington on m.pilkington@pierce.co.uk
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