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The decision to become self-employed is a big step, especially if you're close to retirement age, and it's not one that you should take without advice. Although one of the main attractions of becoming self-employed is no longer having to work for somebody else, there are several disadvantages that you should consider.
If you run your own business, there is no holiday or sick pay, no pension and no regular income, and every chance that you will have to work longer, irregular hours and sometimes weekends. You will also have to submit your own tax accounts. The benefits include not having to work for somebody else, self-fulfilment, making full use of your experience, talents and abilities, financial independence, and possible flexible working hours.
There are different ways of being self-employed:
- As a sole trader, working alone: the simplest option
- In a partnership: with two or more people
- As a limited company: the business has a separate identity
- A franchise: an agreement that allows the franchise buyer the right to run a branch of a business that someone else has set up
Before you become self-employed, you will have to research and develop your business idea, then prepare a business plan that reflects what you need to do to set up and run a business. You will need enough money to live on while you start up the business, plus funding for start-up costs. You will also be responsible for paying your own tax and National Insurance. You will have to pay tax on your State Pension if you are still in paid work when you receive it.
If you are considering self-employment and do not already have an idea of what you want to do, you could consider something which uses your experience or skills, or something which you have previously done as a hobby.
The following organisations can provide information and advice on all aspects of starting your own business and becoming self-employed.
PRIME
PRIME is the only national organisation that is dedicated to helping people aged over 50 years old to set up in business. They are a not-for-profit company whose aim is to release the untapped potential of 50+ enterprise. They believe that everyone should have the opportunity for self-fulfilment and independence that working for yourself can provide. In Britain, there are currently approximately 3.6 million people aged 50 to 65 years old who aren’t earning an income. This is often not by choice. Since 60% have only their state pension to live on for retirement, many live in poverty. PRIME encourage those aged over 50 years old to consider the possibility of self-employment or starting a business, or to find a local organisation that can give them initial business help and advice.
For further information, contact PRIME using the details given below, or visit their website.
Business Link
Business Link provides the information, advice and support that is needed to start, maintain and grow a business. It provides information and advice to help people to make the most of their opportunities. Rather than providing all the advice and help itself, Business Link fast-tracks customers to the expert help that they need. For further information, contact Business Link North East using the details given below, or visit their website.
Citizens Advice Bureau
The Citizens Advice Bureau can provide information on many aspects of self-employment including training, how to trade, finance, book keeping and accounting, income tax, premises, business rates, health and safety, insurance, employing other people and National Insurance contributions. For further information, visit their website, or contact your local Citizen’s Advice Bureau using the details given below.
Other useful information
Age Concern’s guide Your employment choices
Age Concern’s factsheet Help with looking for work or starting your own business
Contact Information
Business Link in the North East
Spectrum 6, Spectrum Business Park, Seaham, Durham, SR7 7TT.
Telephone : 0845 600 9006.
Email : enquiries@businesslinknortheast.co.uk
Citizens Advice Bureau (CAB)
St Cuthberts Chambers, 35 Nelson Street, Newcastle upon Tyne, NE1 5AN.
Telephone : 08701 264 015, Fax : (0191) 232 0461.
PRIME
Astral House, 1268 London Road, London, SW16 4ER.
Telephone : 0208 765 7833, Telephone Helpline : 0800 783 1904, Fax : 0208 765 7879.
Email : prime@ace.org.uk
Article last updated August 19, 2008 1:48 pm
