Stress doesn’t just affect people who are employed. Self-employed people are susceptible to work stress, depression and burnout due to the pressure to create an income and the uncertainty that comes with being self-employed. If you work from home you can also become isolated which can lead to mental health issues. It can also be stressful if clients don’t pay on time and there are problems with cashflow. Being self-employed has many advantages, however it’s a good idea to be aware of the pitfalls before you go into self-employment so you can aim to prevent being negatively affected by common self-employment issues.
Advantages of Self-Employment
Freedom – To be able to work from home, avoid the daily commute, plan your day the way you want it and decide who you work with can be truly liberating.
Ability to earn more – Often you can charge more per hour being self-employed and earn more than you would earn being employed.
Flexibility – Being self-employed means you can work where you want, when you want, however you want, with whom you want. This can be beneficial if you want to spend more time with family or have more time for things you’re passionate about.
Disadvantages of Self-Employment
Uncertainty – You have to be able to cope with things being more uncertain, especially when you first become self-employed. There may be more work at certain times of the year and less at others. You may get work, then for some reason it doesn’t go ahead.
Financial pressure – When you’re self-employed, obviously it’s down to you to earn the money. If work isn’t coming in then stress levels can rise if there’s a problem with paying the bills. You also need to keep on top of your accounting if you don’t have an accountant.
Isolation – If you work from home, you may find that you become isolated, and it can be difficult especially if you’re used to working with colleagues every day.
Time Management – it can be difficult to manage your time, especially in the beginning. Having total control over your workload and no one to go to for help and support can be stressful.
Potential Burnout – Because the buck stops with you and there is so much to do when you first start a business, you are susceptible to overwork and burnout. Burnout is a state of emotional, mental, and physical exhaustion caused by excessive and prolonged stress. It occurs when you feel overwhelmed, emotionally drained, and unable to meet constant demands.
How To Deal With Self-Employment Stress
- Learn how to manage your time – don’t become overwhelmed by too many projects. When the work starts flowing in, it can be hard to know how to plan your day. Using to-do lists and planning your day the night before can help. Using time management software/apps which allocates a certain amount of time daily to each project can help. A weekly desk planner can help you to plan your week – don’t forget to plan in time to relax. Take regular breaks (for every 25 minutes you work, take a five minute break, or for every fifty minutes you work, take a ten minute break). Do something nice in your break – go for a walk, colour in, read.
- Co-working – avoid isolation by finding a local co-working group. You can share a workspace with other self-employed people which is good for combatting isolation. Getting out of the house once a week can really help to improve your wellbeing and you can also meet new potential clients at co-working sessions. Even getting out of the house and working in a coffee shop or local library can help by having a change of scene.
- Get on top of your accounts – ideally hire an accountant to do your tax return. When you first become self-employed you may not have the money to do this, so make sure that you keep all of your receipts for your expenses (travel, supplies etc) and also keep on top of printing out your invoices. Keep a spreadsheet and make sure you record your income and expenses monthly instead of leaving it all until the end of the year, which can be really stressful.
- Prioritise self-care – when you first become self-employed you may work harder than you’ve ever worked in your life. Networking, creating an online business, using social media and getting your business out there can take over your life. Make sure you plan in time to look after yourself (exercise/yoga/meditation/getting outside/time with family). Please see the self-care section of the website for tips on how to look after yourself well.
- Delegate – When you’re self-employed you’re like the CEO of your own organisation. There are many different departments, such as marketing, accounts, HR (if you have employees), IT, branding etc. It’s impossible for you to be good at everything, so why not outsource the tasks you don’t enjoy or aren’t good at. Hire a social media manager to help you build your social media presence at the beginning, and learn how to be effective at it. If you hate figures, hire an accountant to get your finances under control. Don’t waste months trying to design a website if it’s not your area of expertise. It doesn’t need to cost the earth to have a website designed.
For more advice and information on self-employment, please go to the following links:
HMRC website – for information on your self-assessment tax return, your tax bill, tax refunds and help/support.
Citizen’s Advice Bureau – here you’ll find a self-employment checklist covering topics such as funding, finance, National Insurance Contributions, insurance and Training.
Business Finance and Support – details on government-backed funding schemes.