Having worked as a freelancer for nearly ten years, these are my six pension-saving suggestions

Nearly ten years ago, Kaylie Pferten, a financial journalist, went freelance

He talks about his experience working for himself while saving for a pension.

Pension saving is a low priority, which is not surprising given the amount of financial responsibility that comes with running your own business, which includes everything from finding work to chasing invoices and keeping accurate accounts for HMRC.

A third of self-employed and freelance workers who aren't contributing to their pensions say they don't know where to start, and 60% of them cite affordability as the main reason, according to research by PensionBee.

One drawback of working for yourself is that auto-enrollment is not an advantage.

You should be automatically enrolled in a pension and contribute to your retirement savings directly from your paycheck if you are one of the 30 million people who work for a company.

Since there is no such assistance available to the 4 million independent contractors in the UK, we must find the time to complete this on our own.

Regardless of employment status, PensionBee advocates for pension reforms that increase access to retirement savings. However, you can begin saving for a pension now without waiting for reforms.

Setting up a pension was one of the first things I did after leaving a full-time journalism job in 2016 to pursue freelance work, so in many ways, I am an exception.

Here are my best recommendations.

1. Start modestly

Employers and employees may be required to contribute a minimum amount to a pension under auto-enrollment regulations, but the benefit of doing it yourself is that you can contribute as little or as much as you like.

When you first start out, cash flow can be a major problem, making it difficult to figure out how much you can afford to save each month. However, the fact that retirement living expenses are still rising is enough to keep me making contributions.

With as little as £100, you can open a self-invested personal pension (SIPP) on many investment platforms. Other platforms may allow you to set up regular savings plans for as little as £20 a month.

2. Think about the tax advantages

Knowing that money will be taken out of your account automatically, even if you are unsure of how much is coming in, can be unsettling.

The pension payments are considered business expenses, so even though I don't receive tax relief on contributions because I operate my freelance business as a limited company, I am confident that they will reduce my tax liability, even if it means taking home less money each month.

3. Get a direct debit set up

The most effective method of making contributions to any investment or savings plan is to establish a standing order or direct debit.

You will ideally be able to forget about the monthly payments and accumulate retirement funds in this way without even realizing it.

4. Use a financial advisor if you can

Establishing a SIPP and managing your own pension is feasible, but it can take a lot of time for time-pressed independent contractors.

In order to ensure that the pension has been set up correctly and to talk about how much I can afford to contribute, I have chosen to pay a little bit more to use a financial planner.

In addition, my portfolio is regularly reviewed, and he serves delicious cookies at our yearly planning sessions.

5. Don't throw away extra money

If you are self-employed, it can be challenging to predict your annual income.

However, you might have extra money in your account if you have a prosperous year financially.

Removing this money could increase your income tax bill, and if you are a limited company, the additional profits could increase your corporation tax bill.

To get around this, you could contribute the extra money to your pension, which would lower your tax liability and increase your savings. You can estimate how much you have left over each year with the aid of an accountant.

6. Disregard the noise

In April 2016, I started working as a freelancer.

The coronavirus pandemic, the Russia-Ukraine war, Brexit, Donald Trump version one, Donald Trump version two, and currently the Middle East tensions have all had a negative impact on the economy during that time.

It was tempting to lower my pension contributions during times when my work income decreased due to this uncertainty.

These have also been excellent times to invest, so just as I always plan ahead for my business, I also know that it's critical that I avoid making snap decisions regarding my pension.

Even though the self-employed pension savings crisis has not yet been resolved, I will be grateful in the future.