A blurring of personal and business life is causing significant problems for the UK’s self-employed workforce. According to the Definitive Study of the Self-Employed, commissioned by accounting software specialist Intuit QuickBooks.
Research among 5.010 self-employed workers in the UK found that on average. They spend over two hours per week separating business and personal finances – the equivalent of 15 working days a year. 19 per cent reported that poor financial management of processes like expenses has nearly put them out of business. And with 75 per cent of the UK’s selfemployed workforce using the same bank account for personal and business income. Many are damaging their chances of success by wasting time untangling business expenses from day-to-day personal expenditure.
Dominic Allon, vice president and managing director of Intuit Europe, says: When people make the decision to become self-employed, they often focus on their idea. How to monetise it and the prospect of growing it into something brilliant. The reality of managing the business finances can be an afterthought, when compared with the complexities of getting a plan off the ground. Our research shows how damaging this approach can be.
No self-employed worker can afford to spend significant time unpicking personal and business expenses when there are business critical activities to focus on – and get paid for. Financial management needs to be at the heart of any strategy, right from the start of any business endeavour, otherwise there is a risk of failure.
The study also revealed the major challenges faced by the self-employed were not having a predictable income (58 per cent) and the uncertainty of the future (44 per cent). Concern around work/life balance was identified, with 23 per cent saying setting boundaries to stop work becoming a 24/7 commitment was a challenge, while 14 per cent cited managing and scheduling life effectively as a worry.