What’s the one thing that causes self-employed professionals most problems and can push them to the brink? Well, according to a new survey – the ‘Definitive Study of the Self-Employed’ – commissioned by all-in-one accounting software giant Intuit QuickBooks, it’s poor financial management.
The survey questioned 5,010 self-employed professionals across the UK about their behaviour, practices and fears. Its findings proved to be quite surprising. Not only do three quarters of the UK’s self-employed workforce use a single bank for both personal and business finances, they also spend the equivalent of 15 working days unpicking their business and personal finances as a consequence. The survey also found that nearly a fifth (19 per cent) of respondents claimed poor financial management of processes like expenses had pushed them to the brink and nearly caused their business to fail.
The ‘Definitive Study of the Self-Employed’ also found that there were other significant challenges facing self-employed professionals; with an unpredictable income (58 per cent) and the uncertainty of the future (44 per cent) being the most significant hurdles to overcome.
Although Intuit acknowledged that the UK’s self-employed community, which stood at 4.6 million in 2016, is both growing and fairly resilient, it believes that with three quarters of workers apparently using the same bank account for personal and business finances, many risk wasting valuable time on financial processes rather than concentrating on their core business. Dominic Allon, Vice President and Managing Director, Intuit Europe, believes that many new to self-employment enter the sector with the wrong priorities, focusing more heavily on their business concept and how to transform that into a long-term profitable company, rather than the financial management side of their new business:
“The reality of managing the business’ finances can be an afterthought when compared with the complexities of getting a plan off the ground,” he said.
“No self-employed worker can afford to spend significant time unpicking personal and business expenses when there are business critical activities to focus on – and get paid for.”
“[However] financial management needs to be at the heart of any strategy, right from the start of any business endeavour, otherwise there is a real risk of failure,” he added.
If you are one of the survey’s self-employed professionals who is wasting valuable time on demanding financial management tasks rather than concentrating on your core business, why not speak to Steven Glicher accountants? If you would like help and advice on financial management, bookkeeping, VAT returns, self-assessment tax returns, payroll or cloud accounting, then call Steven Glicher accountants on 0161 485 8007 or email firstname.lastname@example.org.