Pensions crisis looming for the self-employed

A pensions crisis threatens the barber industry if stronger action isn’t taken on self-employed pension schemes, warns the NHF/NBF. Over half the people working in hair and beauty are now classified as self-employed and therefore less likely to be paying into a pension scheme.This means they will be relying on just the State Pension when they retire, up to a maximum of only £164.35 per week (itself dependent on having made  full National Insurance Contributions).

The government released its strategy for retirement savings for the self-employed in December.  It includes a series of trials to test out the best ways of encouraging the self-employed to save for their retirement, mostly through marketing messages promoting the importance of saving and providing links to suitable savings schemes. Hilary Hall, chief executive of the NHF/NBF, says: “ We have been calling for some form of pensions savings scheme, administered through their tax returns, which all self-employed people are opted into. They could opt out if they choose, for example if they’ve already made provision for their pension.  While raising awareness of the need to save is important, concrete action is needed to make sure pensions are seen as a priority.”