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, 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.
Funds could dry up
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.
Most suitable policies
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.
Are you and your loved ones protected against life’s ‘what ifs’?
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, please contact us.
 LV= surveyed 4,000 nationally representative UK adults via an online omnibus conducted by Opinium between 16 August and 1 September 2022.
This information has been prepared using all reasonable care. It is not guaranteed as to its accuracy, and it is published solely for information purposes. It is not to be construed as a solicitation or offer to buy or sell securities and does not in any way constitute investment advice.
Information based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.
The value of investments and income from them may go down. You may not get back the original amount invested.
Past performance is not a reliable indicator of future performance.
Tax advice is not regulated by the Financial Conduct Authority.