Did You Know...

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Is EI Worth it for the Self Employed?

Employment insurance is finally available to the self-employed, but if you're planning to take advantage of the program in 2011 when it officially becomes available, you'll have to start paying into it now.

In order to be eligible for the program, you must pay in for a full year at a rate of 1.73% of your earnings, to a maximum of $747.36 per year. Once you make a claim, you have to pay into the program for as long as you're self-employed.

Many are debating whether this new perk is worth the premiums that must be paid to access it. Since self-employed workers can't technically lose their jobs, employment insurance really only covers maternity leave (up to a maximum of 15 weeks), parental leave (max 35 weeks), sickness (to a maximum of 15 weeks) or compassionate care (maximum six weeks). Of those eligible claims, maternity and parental leave are really the only two that might be worth the premiums. For compassionate care and sickness, you'd be better off saving an 'emergency fund'.

The blog Canadian Dream crunched the numbers and determined that, to break even on the program, you'd have to claim the full 50 weeks of maternity or parental leave at the maximum rate for a total of $20,000. At the maximum contribution rate of $747.36, it would take 26 years to break even. So, if you're opting to have more than one child, or if you're claiming maternity/parental leave after the age of 30 (and planning on retiring before the 26 years are up) it might be worth it.


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At Greenwood Estates and Mortgage Company, Mission, BC, we represent dozens of lenders and loan programs across Canada. With our experience in banking and finance we can help you find the best rates for your needs. Many years working in the banking and finance industry has given us a great network of contacts that we can use to find the best product for you. Mortgages, business loans, refinancing, credit lines and debt consolidation are our business.

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