Making a leap to become self-employed or a freelancer can be incredibly freeing—but it may also be terrifying if you’re unprepared. After all, bidding farewell to your employer also means saying goodbye to the benefits that you enjoy.
Choosing the self-employed path means you won't have the typical benefits offered by government agencies and private companies. You will be in charge of registering for your own SSS, Pag-ibig, and Philhealth accounts, and making sure that monthly dues are paid. The latter can sometimes be a challenge, especially with the inconsistent income. This may become a problem when sickness, disability, or death happens in the family and affect your expenditure and savings.
The good news is it can be done! Many who have taken this route have flourished financially, and there is no reason why you can’t be a success story yourself.
As a freelancer, you must carefully plan for your financial stability and assess your current finances to determine how much they can allocate to investments. Uncertainty could have a knock-on effect in your income. If you’re worried about your long-term financial security, investments can help you protect your future.
Here are some investment options for the self-employed to craft a path to fund your goals:
Stocks. A stock, or an equity ownership in a company, is a good option for those who want to capture the potential long-term growth of their investments and fund their future goals. The earlier you start, the greater your potential returns. Stocks are for aggressive investors who are willing to take in higher risks for higher potential returns.
Bonds. When companies and governments need to raise funds for their projects, they issue bonds as a form of borrowing from the public. Bonds have a fixed interest rate and maturity date. Bonds are for conservative investors who prefer stable yet modest returns on their investments.
Mutual Funds. Mutual funds are regulated by the Securities and Exchange Commission (SEC). Here are some reasons why mutual funds are good for the self-employed and freelancers:
- Affordable: Low minimum investment to open an account. You can open an account for as low as Php100 and build your funds regularly.
- Professional Fund Management: You have professional fund managers analyzing, trading and monitoring the funds for you.
- Your investment is diversified into different securities: You are not limited to a certain stock or bond, thus, minimizing your exposure to risk.
- Mutual fund returns are not subject to withholding tax.
MP2 (Modified Pag-IBIG 2) savings. The Pag-IBIG MP2 Savings is one of the investment options for self-employed people in the Philippines. This savings program has a 5-year maturity intended for Pag-IBIG Fund members who want to save more and earn higher dividends aside from their Pag-IBIG Regular Savings. Pensioners and retirees who were former Pag-IBIG Fund members can also avail of this program.
These are among the investment options available should you decide to become self-employed or a freelancer. As you can see, you can still save for your financial goals, even if you do not have a fixed salary nor the benefits of traditional employment. Investing can especially be of help for you and your family in case of a sudden illness, disability, or death.
Sun Life Asset Management Company, Inc. (SLAMCI) is the largest, non-bank affiliated asset management company in the Philippines in terms of Assets Under Management (AUM). SLAMCI is ranked by the Philippine Investments Fund Association (PIFA), as among the largest and most awarded asset management companies in the Philippines.
SLAMCI manages and distributes a wide variety of mutual funds. Among these are target date funds, which grow one’s investments over a specific time. These funds are ideal for addressing a financial goal slated for a future date like retirement or funding a child’s education. Know more about mutual funds here.
As your Partner for Life, we are here to help you achieve a brighter life. We offer a wide range of insurance, wealth, and asset management solutions to help you. We’ve created easy and accessible financial investments with the right mix of funds for all types of investors. Whether you are budget conscious or want to maximize your earning potential, we have the right investment options for you!
In need of assistance with investments? Connect with a Sun Life financial advisor who can help you achieve your goals.