Experiences of going self employed

[hollyreccos]

Particularly if it’s in an entirely different field?

I would love to chat about people’s experiences and advice on this one.

I’m currently working three days a week in a stressful profession. I have my own caseload, so on my days off no work is being done and frankly, I’m not coping and I’m burnt out.

I have a just turned 5 year old who is in reception at school. I’m desperate for more flexibility and control, but I do need to earn money.

I am looking into retraining as a celebrant, and also looking into Parish clerk positions. And open to any ideas really!

For people who made the leap, how did you go about it?

-Did you start working on the new venture before handing in your notice, and if so, how did you juggle both?
-Did it take a long time to establish your new venture?
-How are you managing the self employed nature of inconsistent earnings?
-How did you find managing tax etc? Do you use an accountant?
-What do you do about pensions?

if anyone has any thoughts to share, I’d be really grateful!

So with the caveat that I started before I had kids, yes I did a lot of self employed work before going full time self employed. I think this is by far the most sensible, as you need to build up business etc. I did the work in evenings and weekends. I have also had to do self employed work during evenings while looking after a small child all day and I'll note that I had no free time and it was very exhausting.

It didn't take too long to establish myself as I was working with a few clients and did great work for them.

Inconsistent earnings is a pain, so you need a buffer of savings and/or a partner with a more stable income. If you have neither, build savings before you make the leap to fully self employed.

Managing tax was a faff but my business was quite straightforward so didn't need an accountant. Be sure to keep excellent records and look up what you can and can't claim. For basic tax rate, put 25% of all income aside for taxes. Also something to note is that HMRC make you pay a big chunk of NEXT year's tax at the same time as this year's. Remember also you're responsible for your now higher national insurance contribution.

You need to contribute to a personal pension. I used NEST, but there are lots of options. The pension provider will claim back the tax from HMRC so it's ultimately pre-tax money going in.

Remember to make your fees higher than your employed hourly rate was to account for having to contribute more to pensions and national insurance, as well as not having any paid holidays! Also if you're thinking of having another child, you may want to do that while still employed as you'll be financially better off.

I have been tempted by various similar roles over the years but realised that the best way to work for myself was to use my professional skillset. There are software packages that can help with all the tax and self-assessment elements, as well as be compliant with 'Making Tax Digital'.

There are some previous posts on being a celebrant and, while they love it, I am not sure that anyone makes a proper income out of it! Put it this way, how many times have you engaged a celebrant yourself?

Being a parish clerk or clerk to governors can make sense, as you can potentially cover two or three organisations to earn more, but again I don't think it really replaces a proper part-time income.

Any chance that you could slightly adjust your hours downwards to cope better in your present role? For example, work 2.5 days over 3 days.

Edited to add: I did 'juggle both' for a while as I started doing little bits of self-employed work alongside my employed part-time income, in several roles. At times it was hard work and I needed to work in the evenings etc, but I would mostly be able to plan ahead carefully to avoid deadlines clashing. I always mentioned it to my employer when I was recruited. It was easy enough to show this in a tax return as you simply describe your income from both employed and self-employed work.