In response to an Office for National Statistics publication “Young People and Self Employment”, published this morning, which finds an expectation of “high pay and leisure time” and a gap between this expectation and reality, Becky O’Connor, personal finance specialist at Royal London, said:
“It might seem like the best of all worlds, but the reality is self-employment is not for the faint-hearted. It can involve periods of no pay, time spent chasing payments and the loss of valuable employee benefits typically offered by companies, such as holiday, a workplace pension, sick pay and enhanced parental pay if you have a baby.
Those considering self-employment need to think carefully about what they might be giving up and have a target income level that reflects the loss of benefits, as well as a big cash buffer that can tide you through the tough times.”
Notes to Editors
- There were more than 500,000 self-employed 22- to 30-year-olds across the UK in 2018, a third more than there were in 2008.
- The ONS found that many 16- to 21-year-olds associate self-employment with a high income, but “the reality is that self-employed workers earn around £3,800 less per year, on average, than employees. This is despite many of them working longer hours.”
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About Royal London
Royal London is the largest mutual life, pensions and investment company in the UK, with funds under management of £130 billion, 8.8 million policies in force and 4,046 employees. Figures quoted are as at June 2019.
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