By Paul Whitfield

For many of us chucking in the daily grind of a nine-to-five job and striking out on our own is the ultimate dream.

No boss, no set hours and every Monday off if you want. Sure, the Christmas party can be a lonely affair but you take the good with the bad.

The problem is, when it comes to your finances, there can be more bad than you might have counted on.

Banks and building societies aren't particularly fond of the self-employed.

Vivienne Starkey, an independent financial adviser with Equal Partners, says: "It can be a problem because you have given up an income and not proven you have a new one."

This can have a host of repercussions on everything from personal loans to mortgages and saving.

But there are some simple tricks and products out there that can help.

Set yourself up

The first rule of going it alone is to plan ahead - that means before you leave your secure job.

Taking some time to set up credit cards and overdrafts before leaving full-time work can be priceless.

There is nothing wrong with asking to increase your credit card limits or applying for other lines of credit before you leave full-time work.

But remember, short-term loans are usually expensive.

It probably isn't a good idea to finance longer-term borrowing, like business investment, with a credit card, personal loan or overdraft.

Mortgage mess

Mortgages can be one of the biggest sticking points for the newly self-employed.

To qualify for a standard mortgage product, providers usually require a history of two or three years of steady income - an impossible ask if you only started out six months ago.

To make matters worse, many self-employed people use a range of accounting tricks to minimise their taxable income.

It is this income that the banks will look at when assessing your eligibility for loans.

Ironically, by improving your tax position - putting more money in your back pocket - you can kill off any chance of getting a decent sized loan.

Self-certified

If you have a problem getting a standard mortgage you might consider applying for a self-certified mortgage.

This is a mortgage that does not require you to give proof of income - in most other respects the mortgages are the same as a standard mortgage.

This increased flexibility comes at a price.

Lenders consider self-certified mortgages to be riskier than standard mortgages and consequently the interest on them tends to be higher.

Ray Boulger, senior technical manager at mortgage broker Charcol, said: "While they do tend to be more expensive competition has forced that margin down.

"Some lenders are now offering the mortgages on the same terms as their mainstream loans."

Many lenders also require bigger deposits on self-certified mortgages than on standard mortgages.

To get a full choice of loans you'll need a deposit equal to about 25% of the value of a property - some lenders will allow you to have smaller deposits but the interest they charge tends to be higher.

Flexible

An uncertain income stream is not only a problem when it comes to getting a mortgage. It may also cause further heartaches when it comes to repaying one.

There is always a chance that money could dry up for a couple of months.

If that happens, having the option to put a mortgage on hold can be a godsend.

If you like this idea you should look for a flexible mortgage; this will allow you not only to put payments on hold but also to overpay when times are good.

Again, this flexibility comes at a price - rates tend to be a bit higher.

But you can make a lot of that extra money back if you overpay your mortgage during the good times.

Emergency money

It is not only loans that need to be reviewed when you set out on your own.

The way you save money may have to change as well.

There is no such thing as sick pay when you are self-employed Vivienne Starkey, Equal Partners

Self-employed people often find they have a greater need for emergency cash - whether it's for personal needs or to shore up their business.

Vivienne Starkey says: "We would normally suggest people keep about two or three months' salary easily accessible, but self-employed people should probably consider having more than that.

"There is no such thing as sick pay when you are self-employed," she adds.

Maintaining this extra cushion will mean keeping more money in instant access savings accounts or current accounts.

In the past that might have consigned you to missing out on the best savings rates - top rates used to be reserved for longer-term saving bonds.

But that doesn't have to be the case any more.

Vivienne says: "Thankfully the rates on the best current accounts and instant access savings accounts have improved to such an extent that they are not much worse than those offered on longer-term bonds."

Pension palaver

Planning and saving for retirement can be another major headache for the self-employed.

No one else will make pension arrangements for you, so there is no choice but to do your own research.

Tom McPhail, a pensions expert with independent financial adviser Torquil Clark, says: "It is important self-employed people provide for their retirement. They don't get as generous state pension rights as normally employed people.

"In addition self-employed people have more scope to build pension planning into tax planning to save them money."

The first thing to consider when you leave steady work is, can you afford a pension?

Remember none of the money you tuck away in a pension fund can be accessed until you reach the age of 50.

There is little point in amassing a big pension for the future if it means being caught short of cash now.

Tom McPhail says: "If you are not sure how much you should invest in a pension you could always wait and make a single annual contribution at the end of the year when your financial position is clearer."

Help

You will have a lot to think about when you first strike out on your own.

Worrying about your personal finances might be a burden you feel you could do without.

This will mean finding a good financial adviser to worry and plan on your behalf.

If you want more information on how to track down a top-notch adviser take a look at our guide: How to find a good financial adviser.

You will find a link to the guide on the right hand side of this page.