Freelancers and the self-employed need to plan carefully for pregnancy by building up a store of cash that can last them at least six months, says Neil Thomas, director of Simpsons IFAs in Brighton. "This is good advice for everybody, but particularly the self-employed."
Flexible mortgages, such as offset and current account mortgages, can also help with financial planning. "Offset mortgages work well for freelancers and the self-employed, because they can offset a pot of money to meet their tax bill," says Thomas. "And if you make overpayments, you can take a payment holiday or dip into that reserve of cash while on maternity leave."
You might also want to take a break from any monthly contributions to a pension or other investments such as an ISA. "Most personal pensions, particularly stakeholder pensions, are flexible enough to allow you to take a payment break for three or six months, or you could reduce your monthly payment to the minimum £20," says Thomas.
He adds that some people ask if they can take a payment break from their life insurance, but this is a bad idea. "The moment you stop paying the premiums, life cover automatically stops, leaving you exposed should the worst happen."
And then there is another option that many freelancers and the self-employed will be familiar with: work like crazy in the months leading up to the birth, and take it a little easier afterwards
The Guardian 30 July 2007