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Survey finds one fifth of North East company owners have no pension


Oct 14, 2016

North East business owners are drawing modest salaries and sacrificing their own pensions in favour of investing heavily in their business, according to a new study by UK chartered accountants Haines Watts as part of their ‘Love or Money’ campaign.

Based on companies with a turnover between £1 million and £50 million, the Haines Watts Wealth Survey reveals the earnings, wealth and spending habits of UK business leaders.

One fifth (19%) of North East company owners surveyed do not have a pension fund, with 16% expecting to retire after the age of 75. Company owners told Haines Watts that they are instead putting their wealth back into their business or taking other risks such as investing on a stock exchange.

Donna Bulmer, managing partner at Haines Watts North East, said: “As a business owner, it’s important to consider your business’ future. However our study reveals that owner-managers in the North East are reinvesting in their businesses to the detriment of their own retirement or lifestyle.

“Considering how hard owner-managers work, many with the hope of an early retirement or a luxury lifestyle, the survey results were somewhat surprising and as such we want business owners to understand the importance of wealth management.

“Haines Watts North East is able to offer a variety of services to support business owners in the region, from ongoing accountancy and tax services to mergers, business forecasts and exit planning. These are really important to help secure the stability of an organisation as well as making sure owner-managers can benefit from running a successful business, that’s why we work so hard to understand each business we work with and their objectives.”

Donna added: “As we have witnessed with the UK’s Brexit vote, the potential for significant market disruption is never far away. The North East’s business owners need to understand this risk and plan accordingly. Wealth is about more than just the here and now; it’s about protecting your financial future, your family and your staff, and Haines Watts North East can help with that.”

With offices in Newcastle and Darlington, the accountancy firm offers a full range of services to owner-managed businesses in the North East. Current clients include organisations in a variety of sectors from manufacturing and engineering to retail, leisure and the voluntary sector.

The firm’s Love or Money survey is the first in a three-part series of studies aimed at exploring the purpose and motivations for running a company in the UK, whilst allowing business owners to benchmark themselves against others.

Other findings from the survey included:

  • The average North East company owner earns £98,300 per annum (including salary and dividends) less than half the average salary of the CEO of an AIM-listed company (£202,000, Fast Growth Company, 2014).
  • The average North East company owner has £140,200 in financial investments, savings, stocks and shares –higher than the national average (£120,900).
  • Over half of business owners (51%) in the North East have a major customer they could not survive without
  • One third (32%) of North East company owners feel their business could not survive for longer than a week without them.

To find out more about the Love or Money survey and to benchmark yourself against other business owners, visit: www.hwca.com/for-love-or-money.

By Emily