Feeling uncertain about protecting your finances as a freelancer? In today’s episode, we’re diving into risk management—a crucial but often overlooked part of financial planning for self-employed professionals.

From income protection and business insurance to emergency funds, having the right safeguards in place can make all the difference when life throws the unexpected at you.

I’m joined by Zoe Brett, a financial planner at EQ Investors, who will break down:

✅ The key types of insurance freelancers should consider

✅ How to balance costs with the right level of protection

✅ Practical ways to build an emergency fund—even when your income fluctuates

You can listen (19 min) and subscribe here:

Now available on: Apple Podcasts | Spotify | Podlink

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Here are some key takeaways from the discussion:

1. Freelancers Need Insurance Too

Without the safety net of an employer, you’re responsible for protecting your income and business. Income protection insurance ensures you still get paid if illness or injury stops you from working. Professional indemnity and public liability insurance help safeguard against client disputes or accidents. Cyber insurance is becoming increasingly important as data breaches can happen to anyone, not just large companies.

"Think of insurance as an investment in your financial security, not an unnecessary expense."

2. Income Protection Helps You Stay Financially Stable

If you can’t work due to illness, income protection insurance replaces up to 60% of your earnings. Critical illness cover can provide a lump sum to help cover major expenses like medical bills or mortgage payments.

"Your expenses don’t stop when you’re sick, and neither should your income."

3. Freelancers Need Larger Emergency Funds

Standard advice suggests saving three to six months’ worth of expenses, but freelancers should aim for six to twelve months. Without a guaranteed paycheck, savings help smooth out fluctuations in income. Keep your emergency fund separate from tax money and business expenses.

"Avoid the feast-or-famine cycle—budget like a business, not just an individual."

4. Set a Regular Salary for Yourself

Freelancers can’t rely on steady income, but they can create stability by paying themselves a fixed salary each month. In high-income months, save the extra rather than spending it.

"You wouldn’t expect an energy company to just let you off a bill. Your business should be treated the same."

5. Diversify Your Income Streams

Relying on one client or a single type of work can be risky. Broadening your client base and exploring additional income streams, like retainers or digital products, can help create financial stability.

"If all your income comes from one client, you’re not freelancing—you’re just one email away from being unemployed."

6. The Right Business Structure Can Protect Your Personal Finances

Sole traders have unlimited liability, meaning personal assets are at risk if something goes wrong. A limited company offers a legal separation between personal and business finances, reducing risk.

"A limited company isn’t just about taxes—it’s about protecting what you’ve built."

7. Work with a Financial Advisor Sooner Rather Than Later

Many freelancers wait too long to get financial advice, assuming they’re too small to need it. But setting up the right protections, savings strategies, and business structures early can prevent major issues down the line.

"Good financial planning isn’t about reacting to problems—it’s about avoiding them in the first place."

8. Plan for the Worst, So You Can Focus on the Best

Risk management isn’t about expecting failure—it’s about creating a safety net so you can take risks and grow your business with confidence. Whether through insurance, savings, or legal protections, having a plan in place ensures one setback won’t derail everything.

"Freelancers without a risk management plan are like tightrope walkers without a safety net. The fall is inevitable—the question is whether you’ll land on your feet."

PARTNER

• Thank you to our partner PensionBee. With PensionBee you can combine, contribute and withdraw online. Take control of your pension, so that you can enjoy a happy retirement and join over 265,000 customers saving with PensionBee.

RESOURCES

• Connect with Zoe at EQ Investors