“I’ve got a back-up plan in case I don’t qualify for the self-employed funding”

Lee Chambers only became self-employed last June, so isn’t sure what government support he’ll be entitled to as he struggles with the impact of the coronavirus lockdown.

The environmental psychologist, who specialises in office design and interaction, hasn’t submitted a tax return yet for his new wellbeing training company Essentialise. So he may not qualify for the Self-employment Income Support Scheme, under which eligibility for a grant of up to £2,500 a month requires a tax return to have been filed for the 2018-19 tax year.  However, the 34-year-old is still optimistic about receiving it. 

“My case isn’t clear-cut. After hearing a Tory MP on Newsnight and talking to my business adviser, I have decided to submit an early tax return to HMRC [HM Revenue & Customs] to prove I have been trading for nine months. Let’s see what the government will do,” he says.

Lee’s clients are all businesses with offices and his contracts pay out on completion. “I was due to finish three contracts in March and April, so am unable to complete them and obtain payment. I have negotiated postponement of delivery, rather than cancellation, so hopefully I will be able to complete the work once we get back to a new normal. There is very little you can do in my job if you are not there!” says Lee, from Preston in Lancashire. 

His wife, Louise, works as a teaching assistant at a private school. “At the moment she is still being paid, and teaching remotely,” he says. They have a son Myles, seven, and a daughter, Annabel, five.

Lee has already put in place a plan to cover their shortfall in income. It includes reducing the family spend by £470 per month, taking advantage of interest-free loans and using his skills to help individuals and bring in extra cash. 

The couple may approach their lender about taking up the three-month holiday on mortgage payments announced by the government –  it would save them £400 a month – but are currently undecided. 

Lee’s back-up plan is the book collection he started in 2012. “I have 100 rare books on motor sport, automotive design and video game design. They are limited editions or books produced on a limited print run. One I have on the Mercedes-Benz SLR Mclaren was particularly difficult to find – it’s a rare book because it’s a rare car, so rather cherished!”

The Formula One fan paid between £5 and £400 for each book. “I was honest with myself and recently picked 10 that I would sell if I need finance during this time.”

Lee is pragmatic, having experienced the 2008 financial crisis. “Back then, I lost out on a training opportunity in my first graduate job. I told myself then to never depend on a corporation to pay me.”

He says a serious illness in 2014 has made him “quite calm in most storms”. Auto-immune arthritis took away his ability to walk and he was in hospital for a month. “My son was 18 months old and my wife was six months’ pregnant. It took me 11 months to walk again properly and months more to deal with all aspects of life,” he notes.

Lee is hopeful that our culture will change because of the pandemic. “While it is a crisis, it has caused us to slow down, be creative and connect with people more deeply.”

What I did

1. My wife and I sat down together with a notepad and brainstormed.
   
2. I negotiated postponement of delivery with clients.
   
3. We cut £470 from our monthly budget. This included cutting out yoga classes costing £55 a month and suspending my gym membership costing £37. I also took £70 off our monthly food shop and £20 off our Sky package. We are saving £100 a month on fuel because we are not commuting. We have also saved £150 a month on children’s entertainment – trips to a theme park, for example, are out. 
   
4. I put together invoices, receipts of costs, contracts and bank statements to show HMRC I have been trading effectively for nine months and have a viable business. I will essentially be submitting an early tax return.
   
5. We discussed taking a mortgage holiday – that would save £400 a month – but have not yet decided.
   
6. I was honest with myself about my book collection and picked 10 books that I would sell if we need extra money.

What worked

• Strategic use of two credit cards: I have had my Barclaycard and MBNA card for 10 years and have a high limit on them, so they will act as a back-up plan. I have always used them strategically for cashback and have probably made over £1,000 this way on each card. 
• Some work is still on: I have a speaking gig at Digital Lancashire’s conference [a service designed to connect digital professionals] – it will be online! I have also pivoted into support for people setting up working from home. Unfortunately, employers are reluctant to invest in that, but this may change.
• Keeping the lines of communication open with my clients and offering advice and a listening ear where I can: postponing delivery of contracts and offering their employees wellbeing packages are really beneficial – though not if my clients go out of business.
• Looking at all options – both personal and business: what can you do to save money in one place, reduce costs in another or make additional income from online services or entertainment? If you are a joiner – make a kid’s online lesson! Everyone has value – it’s just working out how to deliver it in this new world. Can you entertain or educate? 
• Talking to my business adviser and a business group where I am a member: that helped me take a “prepare your paperwork and see what the government decides” approach.
• We have done lots of free online stuff with the children, including PE with Joe Wicks, virtual tours at Knowsley Safari park in Liverpool, baking and woodwork. My parents-in-law have been teaching Miles and Annabelle to bake bread, pastries and tarts. 
• My wife and I talk about finance, but because I am the systems/numbers person, I deal with it.
• I record everything I spend and have always lived within my means; during the good times, I have always spent more. It helps that I am very comfortable in this world – I have done accountancy qualifications and have a system for my paperwork.

What didn’t work

• I pitched virtual assessments to my clients for workers’ designated homeworking spaces and employee coaching, but I got resistance to that in the short term due to companies not wanting to spend money. I’m understanding of that.