The Challenges of Financial Wellbeing for the Self-Employed: What a Solution Could Look Like

It’s impossible not to have noticed the risks faced by self-employed workers during this crisis.  

Not only have many gig workers been on the front lines of this crisis – supplementing NHS staff, delivering our meals and much-needed medicines – they are also the last and least looked after working segment in the UK’s aid efforts.   

In a recent UK-based survey, 71% of self-employed say they are not able to benefit from the government’s Self Employed Income Support Scheme.  

Furthermore, 96% of UK self-employed workers don’t have income protection (Cover) and 93% do not have any critical injury or health protection (The Independent / Scottish Widows).  

That’s over 6 million self-employed people in the UK alone without any financial protection 

Why does this matter? 50% of self-employed have no backup savings should they be unable to work (The Independent / Scottish Widows) and a quarter (24%) of flexible workers experience problems with income volatility (up from 19% in 2017). 

Even before this crisis millions of self-employed workers were living paycheck to paycheck and facing the pressures of economic instability and the current pandemic has only exacerbated these problems. 

And this pays a large toll – without income stability or savings, workers are forced to work when unwell, worry about what could happen should they be unable to work or feel the constant stress of an unexpected bill.  

Without social safety nets or support from an employer,  the self-employed worker must bear the costs of protecting themselves.  But when money is so tight, personal insurance or pension contributions become unaffordable luxuries, making workers extremely vulnerable. An incredibly vicious cycle.

For instance, in a recent Dot Everyone report:

A female cycle courier was quoted that she thinks “about [nearly] crashing every day, there is definitely a chance of it happening in the long term. It’s not clear what you can do to financially survive if you do have an accident.”

And a driver in London was quoted:  “I do 60 hours, I make £750. But then you have to deduct expenses, around £150 on fuel. I can take out £600 but then you pay insurance, VAT for cars. It’s been four weeks where I’ve made no more than £400. You’re just managing your expenses and taking £150 – £200 home.”

Income security is one step above breathing in Maslow’s hierarchy of needs – simply this isn’t a “nice to have,” but a fundamental need

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Financial wellness is a key linchpin of overall wellness as mental health, emotional and physical wellness and are inextricably linked. 

Without the foundation of financial security, mental and physical wellness aren’t possible and the toll isn’t just on the individual – society and businesses bear a cost too.   

Low financial wellness and security costs companies it directly translates to low motivation and engagement, and as a consequence,  high churn.  The cost isn’t small – our research shows this costs on average £350 per worker every year.

It’s up to us and in all of our best interests to fix this systemic economic imbalance. It’s also the reason we’re on our mission at Collective Benefits. 

We’ve built the first insurance and benefits platform for the self-employed and for less than the cost of a coffee per person per month companies can look after their flexible workforces. 

By providing worker financial wellness our partners have seen reduced worker churn, increased engagement and revenues – it doesn’t just make business sense, it’s the right thing to do.

About the author

Anthony Beilin started Collective Benefits after he suffered a back injury that left him out of work for 6 months. Previously to this, Anthony was the Global Head of Innovation at Aviva and is a successful serial entrepreneur, founding and exiting unbound, a global media company. 

Collective is a venture-backed insurtech platform offering tailored insurance products and benefits for the self-employed like sick pay, family leave, and mental health support. Collective partners with companies helping them boost loyalty, reduce churn and talent acquisition costs by giving their self-employed workforces the protections and benefits they want and need.



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