7 Retirement Planning Investment Strategies for Freelancers

Freelancing has the potential to be extremely rewarding, but you should also plan your retirement planning investments property. Here is some money advice to make sure you're on the proper route to financial independence.

Share on facebook
Share on twitter
Share on linkedin

Many office workers have resigned from their normal jobs and started freelancing because they want to make a profession out of their passions. While freelancing may be extremely rewarding, it can also be risky, especially in the early stages when assignments are few.

It may also be difficult to meet your financial obligations without a consistent source of income, especially if your income is projected to be lower than your last-drawn wage. Savings and investments, understandably, take a back seat during this period as day-to-day expenses take precedence. Even when your finances stabilize, de-prioritizing savings and investments become a habit as you focus more on operating expenditures. This might leave you exposed to life’s whims, over-reliant on unneeded loans, and unable to fulfill your financial objectives on time.

Also Read: Retirement Planning Investment Strategies With Real Estate In India

7 tips for freelancers to achieve financial freedom

If you’re a freelancer, our advice may come in handy.

  • Aim to save at least 10% of your income

Freelancers frequently do not have a steady source of income. They make a lot of money in some months and very little in others. As a result, compared to salaried and professional workers, careful financial planning becomes even more crucial for them. As a result, freelancers should set aside at least 10% of their earnings to invest. One may invest much more depending on their financial objectives. It’s important, though, to make this a habit. Regular and wise investments will not only strengthen their financial foundation, but the power of compounding will also help them build their fortune.

  • Include Real estate in your investment portfolio

For millennia, real estate has always been marked by an increase in the property’s value. With more and more multinational corporations investing in India, real estate values have risen at a quicker rate than ever before. It is all the more attractive for real estate investors in India in the post-Covid-19 climate, with international investors eager to relocate their investment from China to India. As people migrate to new cities, there will be more employment, more inflow, and more individuals eager to buy properties. As a result of increased demand, real estate prices will rise.

Even if you invest in a home that appears to be of lower value on the outskirts or in the suburbs, it might turn into a gold mine in the future due to rising property values! Whether it’s real estate for novices or real estate for entrepreneurs, you’ll discover acceptable solutions.

  • Include mutual funds in your investment portfolio

Fund managers are in charge of identifying and selecting the greatest investment assets accessible in the market. These assets might be stocks or bonds. Freelancers frequently lack the time and skills needed to choose the best investments. As a result, having mutual fund assets in their investment portfolio is preferable. Please keep in mind, however, that each mutual fund plan has its unique set of risks and rewards. As a result, it’s critical to choose the right type of fund that aligns with their financial goals (such as raising funds for a home down payment or building an adequate retirement corpus) while taking into account factors such as risk factors, return expectations, tax and inflation impact on returns, liquidity requirement, and so on. They can also consider FDs or RDs, PPFs, ELSS, and other investment vehicles. If a freelancer becomes stuck at any stage, they should seek the advice of a competent financial counselor.

Also Read: The Ultimate Guide To Retirement Planning Investment In India 2022 & Beyond

  • Use SIP (Session Initiation Protocol)

Even though freelancers do not have a steady source of income, they can join a Systematic Investment Plan (SIP) in mutual funds with a little amount to profit from the rupee cost average and reduce risk. To save time as a freelancer, you can set up an auto-debit feature straight through your bank account.

  • Open a high-interest savings account or one that allows you to sweep money in

Many banks provide savings accounts in which, if the balance exceeds a certain threshold, the money is automatically converted to a fixed deposit, which pays greater interest. As a result, freelancers should choose a bank that provides the sweep-in service. Another alternative is to put the money in a high-interest savings account, which certain institutions provide. It gives you the freedom to withdraw cash whenever you choose without jeopardizing the interest rate on your remaining amount.

  • Make sure you have enough insurance

Everyone needs insurance, not just to safeguard their finances but also to save money on taxes. Companies typically provide group insurance for their employees, which freelancers do not have access to. As a result, freelancers should consider purchasing a comprehensive health insurance plan that provides a substantial sum assured for themselves and their families to protect their funds in the event of a medical emergency. In addition, they should consider purchasing term insurance (with an amount assured of at least 10 times their yearly income) to safeguard their family’s financial interests in the event of their death.

  • Demand a contract

Clients not paying on time or withdrawing a project in the middle of a project are common barriers for freelancers. However, some of these concerns might be alleviated by signing a contract before starting employment. In opposed to ad-hoc work, a contract gives more security and assurance of employment and income. Before you begin freelancing employment, insist on a formal contract. You may find it difficult to secure contract employment at first, but as you acquire experience, things will fall into place.

Also Read: Retirement Planning: Traditional real estate method vs. Cryptocurrency?

  • Register to work as a freelancer

Registering with various agencies, organizations, and government bodies will not only help you land more projects but will also increase your credibility. You may also register for GST and obtain a Micro, Small, and Medium Enterprises (MSME) certificate, based on your eligibility and income.

Also Read: What Is Pre-retirement Planning In India?

Freelancing is a significant step toward achieving professional independence. And these money suggestions will guarantee that you are on the correct course to financial independence as well. Finance is an area of life were making rash judgments may cost you a lot of money. Financial planning is crucial, and all of these suggestions must be followed when doing so. Because you don’t have an institute to fall back on, being self-employed and a freelancer comes with additional duties. You may continue to be your boss without fear if you have a solid financial plan in place. Assetmonk maybe you’re the best option if you’re seeking a real estate partner to start your investing with. Assetmonk has been providing some of the safest and greatest solutions in India to its clientele. Get in touch with our staff to get started on your investments right away.

Retirement Planning Investment Strategies for Freelancers FAQ'S:

Term insurance plans, insurance that doubles the price, traditional life insurance with cash at regular intervals, unit-linked insurance plans, saving com life insurance plans, monthly or one-time investment plans, and so on are some of the acceptable investment plans for freelancers.

Start with a Roth IRA if your freelancing income is currently minimal and you expect it to increase over time. Choose a conventional IRA if your freelancing income is large. (Also, a Roth IRA has income restrictions; people who earn too much are ineligible to contribute.) Another reason to start with a Roth is to avoid penalties.)

Related Articles

istockphoto 636187984 612x612 1

National Savings Certificate Interest Rate 2023

National Savings Certificate (NSC) is a government-backed savings product available in India. NSC interest rates are determined by the government, and they offer a fixed rate of return over the life of the investment. The current interest rate for NSC is 6.8% per year. NSC interest rates are subject to change, but they have remained relatively stable over the past few years. In 2023, the interest rate is scheduled to increase to 6.8% per year. This will be the first interest rate increase since 2016, when the interest rate was increased from 7.6% to 7.9%. NSCs are a popular savings option for Indian citizens, as they offer a guaranteed rate of return and are backed by the government. If you are looking for a safe and secure investment option, NSCs may be a good option for you. Also, read NSC – National Savings Certificate. How the interest rates on National Savings Certificates have changed over time? If you’re looking for…

Read more
istockphoto 1136161903 612x612 1

Post Office Tax Saving Scheme

The post office tax savings schemes are a government-sponsored investment plan in India. Under the schemes, investors can save taxes by investing in specific post office savings instruments. The schemes are currently available in all post offices across the country. The schemes offer several benefits to investors, including tax exemption on the invested amount, interest income, and capital gains. Investors can choose from a variety of post office saving instruments, including fixed deposits, National Savings Certificates, and Public Provident Funds. The post office tax saving scheme is a great way to save taxes and grow your money. If you are looking for a safe and secure investment option, this scheme is worth considering. Also read Post Office Time Deposit. What are the Post Office Tax Saving Schemes in India? The post office tax saving schemes are a long-term investment plan offered by the Indian government. Under it, you can invest in various post office saving schemes and get income tax…

Read more
istockphoto 1439112216 612x612 1

EPF Form 5 for First-Time Employee Registration

What is EPF Form 5? EPF Form 5 is for First-Time Employee Registration. Each month, employers fill out EPF Form 5 with information on fresh hires from the previous month. These fresh hires qualify for the services of EPF. Employee Provident Fund Organization applies to all companies in the organized sector industry with 20 and more workers. These companies must offer EPF facilities to qualified employees as well as deposit to their EDLI, EPS, and EPF. Each month, they must notify EPFO of new recruits entitled to EPF offerings by completing Form 5 and sending the form to the EPF Commissioner in their region. EPF Form 5 Details Objective Submitting information on a new EPFO member in a specific month Website https://epfindia.gov.in/site_docs/PDFs/Downloads_PDFs/Form5.pdf Qualifying criteria Employee Provident Fund Organization’s authority should extend to the employers. Is it necessary? Yes. Who is required to fill out EPF Form 5? Employers. Time for filling out EPF Form 5? Each month. Submitting the details…

Read more
National Pension Scheme (NPS) India For NRI Investors | Assetmonk

How to Open NPS Account Online

Wondering how to Open NPS Account Online? But, firstly what is NPS? The National Pension System (NPS) is a social security scheme that may be accessed online. PFRDA  has control over NPS. Its goal is to provide financial rewards via pension after retirement. The federal government created NPS in 2014. NPS is a scheme that is based on contributions that provide retirees with returns that are linked to the market. Also read NPS Vs PPF: Comparison, Return Rates & Which is Better. How to Open NPS Account Online? An NPS account can be opened in 2 ways: Through the BankBazaar portal Through the NPS portal Also, read NPS Customer Cares Support Toll-Free and Contact Numbers. How to Open NPS Account Online: Through the BankBazaar portal Step 1: Go to https://www.bankbazaar.com/nps-signup.html on the BankBazaar portal. Step 2: Select ‘Investments’. Next, select ‘National Pension Scheme’. Step 3: You’ll be sent to a fresh webpage. Step 4: Click the ‘Create new account’ button.…

Read more
istockphoto 1364622197 612x612 1

LIC Jeevan Anand Vs PPF: What are the Differences?

LIC Jeevan Anand Vs PPF: What are the Differences? As can be seen, there are several sorts of investment routes, each with its own set of features and risk and return levels.  Investments linked to the markets are those invested in the markets. They provide returns that are not guaranteed. Fixed-income investments do not participate in the market and ensure returns that are guaranteed. These are typically preferred by those who are averse to market volatility, and if these avenues provide tax breaks. Section 80C of the 1961 Act provides several potential investment possibilities with tax advantages. The LIC Jeevan Anand and PPF plans are the most prominent options under Sec 80C. These plans have certain commonalities and distinctions that you should be aware of before investing. So, let us investigate LIC Jeevan Anand Vs PPF differences. LIC Jeevan Anand Is? LIC Jeevan Anand is a well-known life insurance product firm that provides a variety of insurance options. LIC Jeevan…

Read more
istockphoto 1372362922 612x612 1

How to Pay PPF online

PPF Online payment modes? Want to know how to do that? Yes, you can pay PPF online. PPF is a tried-and-true investing option for a huge segment of Indian residents. You might be accustomed to making a PPF payment in person, there are various methods for paying PPF contributions online too. The process of how to pay PPF online is not too complicated. Thus, allowing you to easily manage your investments with no problems. The Indian government fully supports the PPF plan, and there are zero dangers related to it. Presently, the PPF interest rate is 8 percent annually. The payments paid for the plan, as well as the interest produced from it, are totally tax deductible by Section 80C of the 1961 Act. Read PPF Interest Rates for FY 2022-23 (October-December). PPF online payment: How to do it? Wondering how to PPF online? Prior to understanding further how to pay your PPF online, you need first understand the different…

Read more