“Your Money” on CTV Morning Live

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CTV Your Money

July 28, 2015 - Financial strategies for contract workers

Contract work can have some sweet perks like working in your jammies, but there can be negatives for your personal financial situation. Here are some strategies if you work on contract:

  • Often, contract workers are self-employed or work as short-term employees so they don’t qualify for employee benefits. If this is you, check out the extended health and dental benefits packages available for purchase from private insurance companies. They can be pricey, but so are dentist bills! The same goes for life and disability insurance, if you have dependents who rely on your income.
  • Self-employed workers are now required to contribute to the Canada Pension Plan which means they will also be able to withdraw from it when the time comes, so that’s good news. It’s like forced saving for retirement. But CPP, even when combined with the Old Age Pension, is not enough for most people to live on.
  • So if you’re self-employed, saving for retirement is doubly important. Get that RRSP started early and be disciplined about contributing as much as you can on a regular basis.
  • One positive thing about self employment is there is no forced retirement, so you can keep working as long as you like or need to, and as long as you can find people to hire you. Consultants who have a lifetime of career experience can be highly sought after.
  • Without a track record of having a consistent income stream, qualifying for a loan or mortgage may be difficult. But if you can prove that you’ve made a steady income for a few years or more, don’t be discouraged. Shop around at some of the less traditional financial institutions and don’t forget to come talk to us at Coast Capital Savings! We can be very open-minded.

Looking for more helpful information? Check out past segments