A guide to healthcare, loans and other benefits for freelance employees
As the concept of “quiet quitting” remains rampant and the shift out of 9-to-5 corporate jobs reigns supreme among the younger workforce, most local employees are now freelancers. However, despite being protected by the Telecommuting Act (Republic Act III65), which authorizes employees to work from home, it is up to freelancers to curate their own benefits package.
While itself a daunting process, acting as your own HR and finance department isn’t impossible. Here are a few helpful tips for financially insuring your one-person team.
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What are the biggest setbacks Filipino freelancers face?
Irregular income and payment delays aren’t the only factors that push working individuals away from freelancing—you’ll also have to bid farewell to standard employment benefits.
Despite earning a higher average of P39,000 a month for roughly 32 hours of work a week, freelancers who want insurance must sustain personal pay cuts.
With freelancing, you can’t enjoy the advantages of paid leaves, bonuses, allowances, health insurance, income tax filing, retirement plans, and other shining, shimmering perks that come with corporate jobs. Not to mention, freelancers have to be in charge of:
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- A sustainable workspace
- A laptop or desktop
- Additional work tools
- A high-speed internet connection
- Any necessary repairs and replacements
Still, Filipinos (1.5 million of whom are already employed under freelance roles) seem to be most attracted to the potential for higher income and generous work-life balance.
But how do freelancers protect themselves from economic instability?
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SSS: Helping freelancers avoid volatility
Unless you were a business owner, registering freelancers as self-employed was once a foreign thought. Now, freelancers earning at least P3,000 a month can become compulsory members of the Social Security System, enabling them to receive welfare benefits such as:
- Unemployment: Freelance environments are often unpredictable. If an employee falls victim to involuntary separation due to reasons out of their control (e.g., downsizing, economic downturn, natural disasters, redundancy, etc.), they have the right to 50% of their salary credit.
- Maternity benefits: Depending on how much monthly income they declare, employed mothers can receive up to P70,000 for delivery (whether normal birth or cesarean). Individuals will have to post at least three monthly SSS contributions within a year of the delivery and provide proof of pregnancy to be eligible for this benefit.
- Sickness and disability: SSS members can redeem sickness and disability credits for work-unrelated illnesses and accidents.
- Pension: If working individuals between the ages of 60 and 65 should retire and have made at least 120 contributions before retirement, they can receive up to P18,495 of monthly pension.
What about health insurance?
Covering out-of-pocket outpatient consultations, laboratory procedures, hospitalization and surgery can be financially devastating in for the freelance market. The good news is that an abundance of affordable prepaid health cards don’t require paperwork. These include:
- Maxicare PRIMA Silver (P4,999/year): unlimited consultations and laboratory testing at any Maxicare Primary Care Center
- My Medicard (P3,600/year): unlimited consultations with Medicard-accredited healthcare specialists
- PhilCare unli-CONSULT (P3,600/year): unlimited consultations with PhilCare-accredited healthcare specialists
- InLife ER Care Basic 50 (P700): one-time outpatient emergency room care up to P50,000 with one-year validity
RELATED: Get Affordable and Reliable Healthcare with Maxicare
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Don’t forget credit cards and loan approvals
Unstable income is often enough for financial institutions to reject those who freelance who are applying for loans or credit cards. In most cases, rejection happens due to a lack of income tax returns (ITR) or financial statements. So, what is a freelancer to do?
Freelancers are more likely to receive approval for secured credit cards because savings accounts back them. When you deposit a specific amount, the bank uses it as a guarantee to settle your credit card balance.
Here are a few secured credit cards that freelancers should consider:
- BPI Express Start (P1,320 to P5,500/year): 2% interest rate with a minimum deposit of P10,000
- Metrobank Save and Swipe (P1,500 to P6,000/year): 2% interest rate with a minimum deposit of P17,000
- Security Bank Fast Tracked Secured Credit Card (P2,000 to P4,000/year): 2% interest rate with a minimum deposit of P15,000
- AUB Secured Credit Card (no annual fee): 2% interest rate with a minimum deposit of P25,000 (up to P250,000 depending on MasterCard type)
Now, what about a loan? Options like SLoan and GLoan are all the rage thanks to simple requirements and options for lower-income earners.
GLoan users are approved based on their GScore and can receive loan amounts of up to P50,000. You can quickly compute loan payments using GCash’s loan calculator. Meanwhile, SLoan can provide eligible users with up to P50,000 in loan amounts, enabling flexible payment options of two, three, six and 12 months.
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The bottom line
While freelancing has its apparent setbacks, the answer to the question “Is freelancing sustainable for Filipinos?” is yes! With ample preparation and solutions in the right places, freelancers can reap the same benefits as they would with a corporate HR package.
Words Zoë Isabela Alcazaren
Art Macky Arquilla
