PRIME Initiative

PRIME has published “Financing an active retirement”, a free guide to pensions for self-employed people over 50. The 32-page printed guide is being distributed free via libraries and Citizen’s Advice Bureaux. You can also download the PDF version immediately from here.

PRIME is concerned that of the 12.5 million self-employed people in the UK, less than half are putting enough money aside to give them an adequate income for their retirement.

As people nowadays are living longer, they need more money to provide for those extra years. Men who make it to 65 are now living on for an average of 20 years, while women can expect to go on for another 22 if they reach 65.

Woman are particularly likely to experience a pensions shortfall, as many have gaps in their contribution record which reduce their state pension. And lower female salary levels typically translate into lower pensions from any company pensions schemes they may have belonged to.

“The self-employed need to bite the bullet and make proper pension arrangements”, says Laurie South, Chief Executive of PRIME. “People think that they can retire comfortably by selling their business, but they may be disappointed.

“In our experience the owners of many small businesses find that their businesses are not as saleable as they thought. The problem is that they - the owner-operator, are often also the chief asset. Without them the business is worth little.”

PRIME believes the wisest approach is to treat providing for your retirement as a business expense from the outset. For many individuals this will mean making contributions to a personal pension scheme while they are running their business. So it will be competing with other priorities - but it may still be worth doing.

You can download our pension booklet here. For a printed paper copy email us at prime@ace.org.uk