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Your Guide to the Personal Costs of Self-Employment

Squamish is a small town on the traditional territory of the Squamish Nation, Sḵwx̱wú7mesh Úxwumixw in British Columbia that’s known to attract adventurous souls.

If you haven’t visited, Squamish is coastal with steep mountains. The terrain gives the creeks their rapids and the trails their downhill speed. In winter, the snow is deep and in summer, the days are long. All year, visitors and locals search for the freedom of the hills in Squamish.

It’s no surprise that the people who are drawn to this lifestyle are often those that crave freedom in many areas of their lives.

Quite a few locals wistfully dream of the freedom to be able to ditch work on a powder day or be able to head out on a weeklong road trip to kayak when they hear that the river levels are rising.

Sometimes it’s about more than practicality, though. Being told what to do, when you need to do it, and how much you’ll be paid can be hard for some people to swallow.

Or, they’ll simply crave a new career adventure when their current career starts to feel stale.

These folks might want to start a business to earn their freedom, often without realizing how much freedom a steady paycheque, not to mention employment in general, can really provide.

If you’re thinking of starting a business, I wonder if you’ve considered a few costs that are hard to grasp when you’re first starting out.

This article isn’t going to be about the cost of doing business. Those costs are highly dependent on your industry or service. This article is going to be about the personal costs associated with being self-employed that are often forgotten by the people I work with.

The early years of business ownership can be tough. There’s a lot of expenses, a lot of them unplanned for, and the transition from employee to self-employed can be very painful. Let’s make it easier for you so you know what to expect and can plan for these expenses in advance.


If you’ve never run a business before, there’s going to be a lot to learn. If you don’t think you’ll need to learn anything, I challenge you to change your mind about this.

Funding a personal development/business development budget will be an important way to make sure you’re running a profitable enterprise.

Medical Expenses

If you have benefits through your employer, these benefits obviously reimburse you for a lot your medical expenses. Have you ever looked through how much you claim each year? If you’re an outdoorsy, active individual, I bet you’re spending a lot of time in the offices of your RMT, physiotherapist, chiro or acupuncturist.

What about your pharmacy? How much would your prescription medications cost without your benefits?

Over the entire year, these expenses that are reimbursed could add up to thousands of dollars. If you are self-employed, brace yourself to pay for these expenses out of pocket, or sign up for a private paramedical insurance program like Blue Cross or the Chambers health plan.

Disability Insurance

The most valuable part of your benefits package isn’t the paramedical reimbursement, although that’s what people value the most.

The real MVP of employee benefits is the disability insurance. It’s group coverage that doesn’t require a medical evaluation beforehand.

If you don’t have group benefits, you’ll need to get your disability insurance privately.

Group coverage is cheap compared to private coverage. If you’re totally healthy, a rough estimate of private coverage is double what you’d pay for group benefits. It’s also deducted from your paycheque typically, so it doesn’t feel as costly.

Consider also that private disability coverage will not cover you for “pre-existing conditions”. For example, if you currently have been prescribed Ativan for anxiety, or Citalopram for depression, then you wouldn’t be covered if you needed to take time off work for severe anxiety or depression. Group coverage doesn’t test for these things in advance, so you’d be covered as an employee under the same circumstances.

Canada Pension Plan

Did you know that your employer is paying half of your Canada Pension Plan contributions?

For someone who earned $100,000 as an employee in Canada in 2022, they would have contributed $3,500 to Canada Pension Plan (CPP) during the year. Their employer would have also contributed $3,500 on their behalf.

A self-employed person pays both amounts if they earned the same amount after business expenses – $7,000. The amount gets paid with the funds left in their bank account when they file their tax return.


A lot of expenses end up staying the same, though.

If you want Employment Insurance, you need to sign up for it in advance (manually), and pay the premiums when you file your personal tax return.

Same with CPP, mentioned above – that gets paid when you file your tax return.

What about GST? GST needs to be charged on your services once your revenue passes $30k, and the money you collect gets paid to CRA when you file the GST return.

Income Tax

The biggest beast to discuss last is income tax. Income tax needs to be paid when you file your personal tax return.

This expense can trip up a lot of business owners, especially in their first years when they’re investing heavily in the business.

A common mistake new business owners make is using 100% of customer payments to keep the business running, hoping to save cash from future earnings to pay their income tax bill.

It’s also hard for people to understand exactly what percentage of their profits need to be set aside for income tax because of our bracketed tax system. Dollars earned sequentially are taxed at different rates, so if the business is earning more than it was expected to, the amount set aside can be less than the tax bill.

Not only that, but your “taxable income” can be higher than shown on your Profit & Loss Statement.

That’s because investments into business assets (think vehicles, equipment, etc) aren’t given a full deduction in its first year. Instead, a percentage is deducted each year.

That means you might be paying income tax on funds you don’t even have, since they were used to purchase those assets.

Loss Aversion

GST, Income Tax, EI and CPP are all paid when self-employed people file returns in March or April of the subsequent year. That means these dollars have been sitting in your bank account (hopefully) all year long.

Unfortunately, that means they’ll be harder to let go of than funds that were previously just deducted before you received your pay.

Disability insurance is like this as well – it can be more painful to pay for than when you simply had these costs deducted from your pay.

That’s because of the behavioural bias called loss aversion. We’re a lot more reluctant to give money away that we already see as “ours”, meaning it’s visited our bank account. Money that never saw your account doesn’t seem as real, so it doesn’t hurt as much to pay.

A strategy to deal with this bias could be to move these funds into separate accounts (or categories in your budget, if you’re a YNABer like me) as soon as you receive them – give that account/category a nickname that really resonates with you, like “The Cost of Not Being a Wage Slave” or “The Government’s Money, Don’t Get Attached”.

A few other gimmes of being an employee

Another note to mention is that employers often offer additional paid parental leave in addition to EI parental leave.

Did you know that paid maternity leave through EI is only 15 weeks?

Parental leave can be split between parents, and is usually 40 weeks total.

In BC, you’re entitled to over 60 weeks of parental leave from your employer, but it does not have to be paid. Some employers offer top-ups, but if you’re self-employed, you’re covering that yourself.

Paid vacation days are also funded by your employer. If you plan to transition to self-employment, remember that all vacation days are going to be unpaid.


Hopefully we’ve cleared the air on what it can cost just to be self-employed.

Employees in our modern hustle culture can often feel like they’re getting the short stick, but there are  a lot of extremely valuable benefits to being an employee that don’t get discussed enough.

If you want to make the transition, speak with your financial planner before you resign so you can work together to make a plan to help you achieve your goals.

The information contained herein has been provided for information purposes only.  The information has been drawn from sources believed to be reliable.  The information does not provide financial, legal, tax or investment advice.  Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance.  This does not constitute a recommendation or solicitation to buy or sell securities of any kind.  Wellington-Altus Private Wealth Inc. (WAPW) does not guarantee the accuracy or completeness of the information contained herein, nor does WAPW assume any liability for any loss that may result from the reliance by any person upon any such information or opinions.  Before acting on any of the above, please contact your financial advisor.  WAPW is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.


The opinions contained herein are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Wellington-Altus Private Wealth. Assumptions, opinions and information constitute the author’s judgement as of the date this material and subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance. All third party products and services referred to or advertised in this presentation are sold by the company or organization named. While these products or services may serve as valuable aids to the independent investor, WAPW does not specifically endorse any of these products or services. The third party products and services referred to, or advertised in this presentation, are available as a convenience to its customers only, and WAPW is not liable for any claims, losses or damages however arising out of any purchase or use of third party products or services. All insurance products and services are offered by life licensed advisors of Wellington-Altus. 

Amy Sweeney



Amy was born and raised in Squamish, is David’s oldest daughter and now the newest member of the Sweeney Bride team. Many may recognize her as she has worked periodically for the team for over 20 years. For the past five years, she has gained administrative experience and more running her own business as a Kinesiologist after completing a bachelor’s degree in Kinesiology at the University of British Columbia in 2016. Now, Amy is officially ready to join the finance industry. Currently residing in North Vancouver, Amy spends all her “free” time raising Dave’s two wonderful grandchildren.
Liam Hill


Associate Investment Advisor

Originally from Sydney, Australia, Liam moved to the Sea to Sky region in 2013, leaving the beaches behind to embrace the mountains. He hasn’t looked back since and enjoys exploring the wilderness by both land and sea.

Liam’s unique strength lies in his capacity to adapt and fine-tune strategies to match the ever-changing financial world. He’s a passionate advocate for adaptability and flexibility, believing these traits are crucial for securing financial well-being.

Liam holds the Canadian Securities Course qualification and is currently pursuing the Chartered Investment Manager (CIM) designation.

He shares his industry knowledge and business skills to empower individuals, families, and businesses on their path to financial success.

Liam is committed to educating our clients about the financial services industry and helping them make the most of available resources to achieve prosperity.


Administrative Assistant

Sharon worked for Sweeney Bride from 2014 to 2016 and recently rejoined the team as an Administrative Assistant in 2021. She has years of administrative experience in a variety of industries including working in legal and accounting firms. She enjoys being detailed, organized and efficient. When not hard at work, she enjoys exploring the great outdoors with her dogs, playing co-operative strategy board games and relaxing while sipping a nice Craft beer.

Carrie Freitag


Administrative Assistant

Carrie is the newest member of our team and is our Administrative Assistant. She has previous industry and administrative experience and her fascination with the finance industry is rapidly growing. Carrie moved to BC in 1994 from Ontario and never looked back. While not working she loves hanging out with her two kids, awesome cat Leo, and enjoys a competitive game of 21, and her gardens.

Katie Norton



Katie is a Business Administration graduate who joined the Sweeney Bride team in 2016. She takes care of on-boarding as well as managing account administration for our existing clients. She works hard to ensure the clients feel supported throughout the on-boarding process and is always available to answer questions.

A BC resident since 1997, Katie and her husband moved to Squamish to raise their two girls. They enjoy all of the outdoor activities and natural beauty that Squamish has to offer.

Liz Woodsworth


Office Manager

Liz joined the Sweeney Bride team in 2015 as office manager. She is the gatekeeper in the office and is the face that greets you as you come through the door. If she can’t help you, she will ensure you speak with someone who can. Liz is a long-time Squamish local; when not in the office she spends her days soaking up all that this town has to offer while chasing her two active boys. Liz brings her valuable organizational skills and enthusiastic attitude to the team. 

Janet Bride


CFP®, CIM® | Senior Wealth Advisor

Janet Bride is a Senior Wealth Advisor at Wellington-Altus Private Wealth and co-founder of the Sweeney Bride Strategic Wealth Advisory team.

With over 15 years’ experience in the Industry Janet holds the Chartered Investment Manager (CIM®), CERTIFIED FINANCIAL PLANNER®, and Elder Planning Counselor (EPC) designations and is also Insurance licensed.

Janet grew up in Ontario and moved out to beautiful British Columbia in 1995 with her husband, Paul, who is an adventure travel photographer. Her passion is to travel the world. Always interested in exploring different cultures and landscapes, she is grateful to have traveled to over 50 countries across 6 continents. She also enjoys continuous learning, spontaneous adventures with family and friends, and an active lifestyle in the Sea to Sky. Janet is proud to be a Big Brothers Big Sisters Alumni member since 2004.

She is highly motivated by helping people reach their financial dreams by creating comprehensive financial plans for individuals & families. While using a holistic approach to wealth management, she specializes in tax strategies and her goal is to encourage savings and help build our client’s wealth for a healthy and prosperous future.



CFP®, CIM® | Senior Wealth Advisor

Dave Sweeney is a Senior Wealth Advisor at Wellington-Altus Private Wealth and co-founder of the Sweeney Bride Strategic Wealth Advisory team.

With over 31 years’ experience in the Industry Dave holds the Chartered Investment Manager (CIM®), CERTIFIED FINANCIAL PLANNER®, and Elder Planning Counselor (EPC) designations and is also Insurance licensed.

Dave has lived in Squamish for most of his life. Married to his wife Donna, since 1987, they proudly have 3 lovely daughters, Amy, Danielle and Jamie. With his time in Squamish, it has allowed him an opportunity to become involved in many valuable groups.

Dave is a retired Captain of Squamish Fire Rescue after 35 years of service. Another passion was sports and he has been a coach for Squamish Youth Soccer Association where he dedicated 10 years to coaching girls Rep teams. Additionally, he is a former member and Treasurer of the Sea to Sky Community Services Board. Dave is a frequent contributor to Mountain FM’s Mountain Monitor, providing general advice and financial commentary.

Dave continues his volunteer work as Treasurer for both the Squamish Hospital Foundation and the Squamish Downtown Business Improvement Association. He is also a sitting Board member of the Squamish Community Foundation.

Professionally, Dave started his Financial Planning practice in 1994. After living through both his parents’ demise and witnessing what a lack of understanding they had, he realized what sound planning techniques could do to ensure that an untimely death did not destroy one’s lifetime work. For over 20 years, he has made it his passion to assist others in not facing the same plight.