Monday, 4 July 2016

"how to have a baby when you're self employed"

This was the exact phrase I googled, repeatedly and desperately in the months before I got pregnant.

We wanted to start a family. I was self employed. I wanted to take some time off. How on earth was it possible to do both?

Where would the money come from? Where would your clients go? I know some people would just carry on working (and of course in America, just a few weeks off is standard, if you're lucky), but I didn't want that. I did want at some time off, more than a couple of weeks.

At the time, my husband was also on insecure rolling contracts (though he now has a staff job) so we always needed a certain financial buffer, just in case.

My clients couldn't just be left hanging for months (I have retained clients rather than project work, mostly).

All of this may look very different if you had family on hand willing to help - there might be no need to stop work altogether. We don't, however.

But, you might know that we now have a baby.

I did it - she's almost ten months, I'm back at work.

So the question is how?

Taken while writing this post

This is not a comprehensive answer by any means - these things might not be feasible for you. But in case anyone is desperately seeking an answer to the same question, maybe some of these will help.

1. Know how much money you have - and how much you need to live on. AKA, have a very good budget.

Sounds simple, right? You earn £x amount every month, so this is how much you have. And you get a bank statement, so you know how much goes out. 

For us this simply wasn't enough. We saved like crazy but kept needing to raid the savings for things like car repairs, household things. And all holidays came out of this same single savings pot. We earned plenty but kept going overdrawn. We never seemed to be prepared for things or to make as much progress on saving as we wanted to. 

The answer for us was YNAB - You Need a Budget. Discovered via discussion in the comments in a post in A Practical Wedding. Tried it and realised instantly that budgeting didn't need to be hard. It was easy and fitted in with our life. It meant we were prepared for all eventualities.

We never went overdrawn again, stopped raiding savings and realised what the big drains on our finances really were. We also realised how much we needed to live on every month, and could then project how it might work if I was bringing in less money. 

Planning a month of realistic outgoings on maternity pay was an eye-opening moment - we could do this. 

2. Money in the bank

Let's be clear - I did not do this on Statutory Maternity Pay (SMP) alone. I paid myself additionally from the buffer in my company during the time I took off. Much, much less than I was on before, and most of what I took was SMP. 

But thanks to the budget, I knew exactly this minimum amount I would need to pay myself per month, and stuck to that.

This meant that in the year or two before pregnancy, I worked a lot. I earned a lot more than I needed to and kept my wages relatively modest, keeping money in the business as insurance against the future. 

As a result, when I went on mat leave, I had earned more than enough to cover this - and to return to work with a buffer remaining so I could rebuild my client base. 

3. Be clear on your real business expenses

I don't use YNAB for my business account - but 'embrace your true expenses' is one of their rules - and it holds absolutely true for business as well as personal finance. Know how much money your business needs to operate while you are not earning. 

My company still had expenses - a pension, phone bill, standing order to accountant etc - and these continued while I was off. I made sure to factor these in to the amount of money that would be required every month, including my wage.

4. Structure your business to accommodate

I lost a major client just before getting pregnant. Rather than look to replace them, I took on more project work which was much more flexible when I needed to stop.
5. Find good people to help you

By the time mat leave began, around eight months pregnant, I had reduced my business to one major client, which I handed over for care-taking to another firm. There were challenges - their rate was much more than mine, but we agreed on a way of covering of the basics for the client while i was away, with any thing additional to be discussed as needed.

The timing also worked out well - having a baby in September meant the quiet Christmas period came right in the middle of my mat leave, and made it easier than expected.

However, the main reason this worked was that I had - have - a lovely, lovely client who wanted to support me and continue working with me in the long-term. To come back with them already in place was amazing. I am very lucky to work with them. Obviously this is definitely a result of luck rather than planning.

6. Just do it, sort of

Obviously, not everyone will conceive easily. I thought I would have more time to figure this out. But three weeks after deciding to 'try', there was the little blue line. This mostly got worked out because we had no choice. 

If you have a rough idea of how things might work, a budget, and you're not close to the financial edge, then you will be alright; you will work it out.

7. Don't expect to go back to earning big money

I am still paying myself the amount I received while on maternity pay. My company is still building back up, and the priority for a long time will be to make sure there is enough money coming in - and then it will be to rebuild a decent amount of cash into the business. 

My wage is more than adequate for our lives. Self-employment is a tool that allows me a lot of flexibility, and I am very lucky to have it, but it requires careful management. 

8. Client expectation management

Plan, plan, plan and leave as little as you can to chance for while you are away. If people know what to expect they will likely be better prepared for your absence.  

9. Shared parental leave, if you can

J was able to take a month off on SPL as I returned to work. Yes, barely paid - statutory only. But we saved in anticipation of this. This month was fantastic. He was able to get to know the baby better and I could focus, five days a week for five weeks on extra projects and getting things built back up before I went back for three days each week.

What do I wish I had done differently?

I wish I had kept closer to my client while I was away - a few things slipped which I would have liked to have kept an eye on. It's no one's fault - just a new person on the account with me disappearing will do that. 

I always intended to be on a call once a month, but the first couple of months were kind of crazy (emergency c-section, shingles (me, not the baby), back in hospital with baby losing too much weight in week one, endless issue with breastfeeding, seeing a hospital psychologist due to the 'traumatic birth' and a scar that took three months to heal) meant I was rather distracted.

So that's it, I think. 

My big question now is how we ever might do this again. One day, we would like to have another baby. But we can't manage on one income. And I like working; like having a business as well as a family.

It will be hard for me to work in the way that I did before - a lot of late nights and frankly taking way too much on. My husband hasn't had a raise in many years, so we hope that might happen before baby number two. The other option is to grow my business to a size that it could manage without me for a few months. But the chances of doing that in the next couple of years are low. I'm already pretty sure this is something to focus on once we're done having babies.

I felt rather bemused reading a post the other day about people returning to work already pregnant again. And then often not returning again after that. Of course, it's your right to do so. But This is out of the question for us, of course. I would have no business at all. 

Maternity rights and decent pay are vitally important for society. But the government needs to do more because the burden on small/micro businesses is very high right now.

While self-employment is fantastic for working around a family, it can be very hard during the actual 'having' of the baby, particularly if you don't have family around and genuinely rely on having the two incomes (rather than it being a hobby business).

But, in short, I am back, the business is growing again and so is our gorgeous baby girl. I am very lucky to have had the opportunity to make this work.

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