Though being a freelancer has its challenges, it certainly has its perks, like the ability to work from home and decide which projects to reject or accept. As such, my fellow freelancers and I have a lot to be grateful for this holiday season. Here are a few things we're particularly thankful for.
1. My SEP IRA
Selena Maranjian: Freelancing clearly has its ups and downs. Yes, there's flexibility and it can be quieter than working in a busy office. But you also don't get those nice benefits that companies offer employees, such as health insurance or a 401(k) plan complete with matching funds. That shouldn't stop any freelancer or contractor from saving for retirement, though -- because most of us, whether we toil as employees or self-employed people, are largely relying on ourselves for much of our retirement income.
Thus, I'm very happy that there's such a thing as a SEP IRA and that I can make good use of it as a self-employed person. (The term "SEP IRA" is short for Simplified Employee Pension IRA, by the way.) It's true that most of us, whether self-employed or salaried, can contribute to regular traditional or Roth IRAs, but those have somewhat limited contribution limits, which are $5,500 for 2018, plus $1,000 for those 50 or older. A 401(k) sports a far steeper contribution limit: For 2018, it's $18,500 plus an additional $6,000 for those 50 and up. The SEP IRA can top even that. For 2018, the limit is 25% of your net income, up to $55,000. (It can be a little tricky figuring out exactly how much you can contribute, so using tax-prep software or a tax pro can help.) You can accumulate nearly $500,000 in a SEP IRA by socking away $10,000 annually for 20 years if it grows at an annual average rate of 8%.
You can set up a SEP IRA at most major brokerages, and the money you park in it can grow tax deferred until withdrawn in retirement. There are other retirement-savings options for the self-employed, such as SIMPLE IRAs, with contribution limits for 2018 of $12,500 -- plus $3,000 for those 50 and older.
2. Schedule flexibility
Daniel B. Kline: Since January, I have spent 26 days at various Florida theme parks. Most of those days have been during the week when someone in a traditional job would have to take time off. As a full-time, work-from-home freelancer, that's not an issue for me. I can juggle my schedule to shift work to nights or weekends in order to take parts of or even full days off.
That has been a blessing not because I love theme parks but because so many friends and family visit central Florida, which is about three hours from my home in West Palm Beach. I have the flexibility to meet people during their vacations, and that has helped me catch up with old friends and tighten bonds with others.
Schedule flexibility also allows me to do things many parents cannot. I've taken my 14-year-old on three cruises this year, along with countless day trips. I'm also able to meet my wife for lunch and make it easier for her to work extra hours or travel for her job.
It's not always easy to be catching up on missed work at night or on the weekend. I am thankful, however, to get to make the choice as to what life events are worth moving things around for.
3. Great colleagues
Maurie Backman: Being a freelancer and working remotely often means plugging away on your own without much coworker interaction. Thankfully, I've managed to develop strong relationships with some of my colleagues through channels like email, phone, and Slack. The fact that we all tend to get together for a yearly work conference helps, too.
In the past, I've worked at companies where I didn't particularly get along with my coworkers. At the hedge fund I worked at out of college, for example, my colleagues were mostly rude and abrasive, and so to say I was socially unhappy there would be an understatement. But the writers and editors I get to work with now are the complete opposite -- everyone is kind, supportive, smart, and just plain fun to be around. And while I wish we'd all get to hang out in person a bit more, for now, I'm thankful for the fact that my colleagues are just an email, instant message, or phone call away.
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