Research suggests lack of business savings putting individuals ‘at risk of financial hardship’
Research carried out by banking group Aldermore has suggested that a lack of business savings is putting a strain on self-employed individuals in the UK.
Aldermore’s data suggested that poor business resilience is putting sole traders and freelancers ‘at risk of financial hardship’.
It found that 22% of individuals have no business savings at all, whilst 40% revealed that their business has less than £1,000 in cash savings.
An additional 54% of self-employed individuals stated that they have been unable to earn money due to ‘unforeseen events’, with many citing ill health as being an issue.
Aldermore’s research also revealed that 8% of firms with a turnover above £50,000 hold nothing in cash.
Ewan Edwards, Head of Savings at Aldermore, commented: ‘Starting a new business is a significant life decision. While many self-employed people relish greater flexibility and control, the first few years can often bring long hours, additional stress and relatively small financial rewards.
‘We want to work with the government to look at means of backing Britain’s entrepreneurs and helping them devise new policies and financial products that will encourage start-ups and protect growing small businesses from the shocks and uncertainties of self-employment.’