Creating a Benefits Package as a Freelancer

Posted on March 17th, 2016

Once you quit your job and begin freelancing, you realize that there were some things that were very convenient about working for someone else. Most of the items are related to the benefits that you receive when you work for an employer.

Think about it: you receive subsidized health insurance, access to a retirement account (and maybe even an employer match), and probably other benefits that might have included life insurance, gym membership, or even childcare. Now all of a sudden you are probably responsible for these costs on your own.

As a freelancer you need to learn about creating a benefits package that works for you.

Do You Have a Partner with Benefits?

First of all, if you have a partner with benefits creating a benefits package is not as important as you might think. If your partner has good health insurance it makes sense to stick with that, especially since his or her employer is picking up part of the cost.

You will also benefit in the long run if your partner has other benefits that you can both take advantage of, including childcare, self employed life insurance, retirement investing, and other perks.

If you don’t have a partner, or if your partner doesn’t have good benefits, you will have to consider creating a benefits package that provides you with the protection you need as a freelancer.

Getting Your Own Benefits

As you consider your own financial needs as a freelancer you can start to put together a benefits package on your own. Here are some of the things you will need to consider as you put together your benefits package:

Health insurance: This is probably the biggest issue you will need to confront as a freelancer. When creating a benefits package this will be the cornerstone. You need to make sure that you are covered in the event that something happens. Not only that, but you also have to be prepared for the fact that health insurance is required by law except in very specific circumstances.

I got my health insurance through the exchange in Idaho. I chose a bronze-level plan with a high deductible so that I could put money into my health savings account. I’m glad I have the insurance because it will help now that I have a broken wrist that needed surgery.

Retirement plan: The other major component of a benefits package is the retirement plan. As a freelancer, you need to be prepared to save it for your future. It’s possible to open a number of plans designed for self-employed people. This includes different types of IRA, as well as a Solo 401(k). Even if your partner has a retirement plan, you should have your own.

Disability insurance: Now that I am struggling with work thanks to a wrist injury, I am glad that I have disability insurance. As a freelancer you might not think that it is necessary, But you might be surprised. I am able to make a small claim for some of the work I had to miss because of surgery.

Life insurance: Even as a freelancerI have always been my family’s primary breadwinner. As a result, my life insurance coverage is higher than my ex-husbands. If your family relies on in your freelance income you need to begin creating a benefits package that includes life insurance so that they are protected.

Other perks: Creating other perks as part of your benefits package requires planning ahead and saving up. If you want to take a vacation you will need to work at ahead or save up money so that it doesn’t matter if you don’t do work. I rarely have times where I do know work, but my location independence means that I can still enjoy myself even if I have to work.

Don’t forget to plan for childcare and to save up money so that you can stay fit, whether you go to the gym for workout at home. As you arrange your day, Make sure you do so with an eye to the type of benefits that you want as someone who works from home.

Miranda Marquit

Miranda Marquit

I'm Miranda and I'm a freelance financial journalist and money expert. My specialties are investing, small business/entrepreneurship and personal finance. The journey to business success and financial freedom is best undertaken with fellow travelers.

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