Self-employed? Why Your Income Isn’t the Only Thing That Needs a Backup Plan
This article discusses the unique financial risks faced by self-employed individuals, emphasizing the need for comprehensive backup plans beyond just income management. It highlights the importance of life insurance and term plans to protect dependants in the event of the earner's death.
Why it matters
Financial literacy for the growing gig economy and freelance workforce is critical for long-term economic stability and family security.
For many people, self-employment represents freedom. There is no fixed office schedule, and often, greater control over the kind of work they choose to do. Whether it is running a small business, working as a consultant or freelancer, or building a professional practice, being self-employed can offer independence that a conventional salaried job may not.
But that independence comes with a different kind of financial responsibility.
A salaried employee may have access to a predictable monthly income and certain employer-provided benefits. For a self-employed person, however, the same individual may be responsible for generating income, managing business expenses, planning for periods of lower earnings and building a financial safety net for the future.
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