As a new or established contractor it is inevitable that you will require access to financial service products.

In permanent employment, a lower, salaried income is enhanced by additional benefits such as income protection, company pension scheme, medical and life insurance. These benefits are largely taken for granted but provide vital protection from hardship that disappears the day that you start contracting.

Depending on your circumstances, you will need to replace some or all of this safety net and must now fund the costs personally. You will have the means to do so thanks to your newly enhanced income and much of this package can also be provided very tax efficiently through your umbrella company.

Additionally you must make the most of your decision to contract and it is important that your money is set to work as efficiently as possible. Company and personal tax breaks must be maximised so that HM Revenue and Customs doesn't end up the real beneficiary of all your hard work! Careful structuring of your finances and investing surplus income wisely can achieve this.

We advise that you seek an independent financial advisor (IFA) who specialises in the contractor market. Only an independent advisor will be able to scan the market for the most suitable product at the best price and only a specialist will properly understand your situation.

Further information and links to an IFA are available to our members through the Members Lounge.