Many of us are self employed business people because thats the path we chose early in our careers.
Some of us had to turn on our Entrepreneurial Charm when the recession hit in late 2008 and threw us out on the street when companies downsized or closed. Making the most of the strong skill set we acquired gave many of us the opportunity of self-employment.
Regardless of the journey and how we came to be self-employed, we must understand that things are different when it comes to our financial needs. Its not as simple as being a wage earner that receives a paycheck each week.
Self-employment is a different game.
We generally get paid based on the profits of our businesses. Once all the bills are paid we can obtain our income. We also need to make allowances for paying income taxes so we arent faced with large amounts owed to the CRA at tax time.
Then of course we will need save while working. Its just not enough to make it through today. Contributing to our future financial needs is something we must continue doing for as long as we work.
Borrowing money is more difficult when you are an entrepreneur. This has never been truer as it has in the past 3 years. Self-employed individuals have a much harder time getting a mortgage in this financial landscape. And lets not even mention the age thing! Lenders wont say you have been turned down due to your age. Thats discrimination! But they will find a gentler way to decline an application especially when you start adding up, self employment, age, equity level and debt load. Believe me, I see it everyday in my role as a mortgage agent.
Self-employment also means reduced or no pensions other than Government Pensions.
If we havent had great advice to start savings during our careers it would have left us with less options when we became active seniors. For those folks without retirement savings it might not even be a choice whether they continue to work well into the senior years.
As we live longer more active lives, staying in our own home is of greater importance. But what can you do if there just isnt enough money to maintain your life style. Renting isnt any cheaper than keeping your own home in most cases. So we need to look at how to create tax-free income as we mature. Reverse Mortgages have gained such popularity because so many folks need extra cash to stay in their own homes. They are a much better choice than they were years ago, hence the sudden increase in those who consider one.
We must also be aware of what would happen if illness, accident or the unthinkable were to happen. Are we insurance heavy or has someone helped us determine just how to protect ourselves without breaking the bank on coverage. Have you ever thought about how many kinds of insurance the average household faces? Things such as home and auto insurance, life insurance, disability insurance, critical illness insurance, extended health insurance, and travel insurance! Need I go on?
Its not easy being an entrepreneur, but heres the good news. There are many entrepreneurs out there in the business realm hat offer the advice and services that we need to secure our financial goals and our lives. Forget about going in alone in such a complex world. Find the professional who listens to your needs and you will achieve your financial goals!
This article presented by Elfie Hayes of Mortgage Intelligence Oshawa. Elfie has been seen on Rogers TV and the CTV News – The National. She is a Mortgage Agent and part of an award-winning team of professionals. She is a proud published author of informative financial articles. You may visit her website at LowRate.ca