Freelancers and the self-employed pay a heavy price for their freedom and flexibility.
Other than the lack of employer's CPF contributions or benefits and an income that can fluctuate wildly from month to month, there's also the need to not spend every cent in your savings account each month, since you never know if it'll be a dud month.
Despite the drawbacks, more and more Singaporeans are choosing the freelance life because, well let's face it, not having to battle the morning crowds or deal with horrid employers makes it worth it.
It's important never to lose sight of the fact that you have to be more careful with your money than your salaried friends, though. Here are three tips for lowering the cost of living as a freelancer.
Learning to cook is mandatory
As a salaried employee, you might have eaten all three meals at hawker centres and food courts, and thought that was the most cost-effective solution, since you didn't have time to cook anyway.
But when you're self-employed, flexible work hours and being able to work from home mean that if you can cook, you'll save yourself a ton of time and money. While the office folks are forced to eat out, you aren't, unless you aren't able to fire up the stove without SCDF rushing to the scene.
If you're rushing a deadline at home at 12 midnight and suddenly get peckish, you won't have to resort to McDelivery to feed yourself. And if you mostly work from home, you can cook lunch and dinner every day instead of eating out.
The freelancer who doesn't cook isn't taking advantage of one of the huge money-saving advantages of not having to work in an office.
Do things during off-peak hours
Your friends who work 9 to 6 are often forced to go perform all their daily activities at the same time as everybody else, which can often cost more money. Taking a cab to work during morning rush hour costs a lot more money thanks to the peak hour surcharge and involves a lot more waiting by the phone, while having to wait till weekends to watch movies means you always pay the highest possible price for tickets.
If you're a freelancer who has flexibility over your working hours, avoid doing things during peak hours and always take advantage of the fact that you can do stuff while other people are at the office to save money.
For instance, many bars have happy hour deals before a certain hour, sometimes as early as 6 or 7pm. Grab a beer with your other flexi-working friends (and if you don't have them, go make some as having other people who can stay out late at night or hang out in the afternoons on weekdays makes your life as a freelancer much better) during happy hour, and then limit your alcohol consumption when you have to pay full price later on in the evening.
Weekday movie, afternoon karaoke sessions and restaurant lunch rather than dinner menus all save money, and you can plan your work around these activities to take advantage of the better prices. In addition, many things take less time when done off peak, whether they be visiting the doctor, commuting or going to the bank. Time is money, as all freelancers know, so it doesn't make sense wasting it in a peak hour queue.
Take advantage of the lower cost of suburban living
Most Singaporeans who work in the CBD have no choice but to bear the expenses that come with it, including higher lunch prices and expensive parking. They pay over $100 a month for a membership at a gym with a Raffles Place branch and $20 for a post-work drink. Even their coffee breaks in the middle of the day cost more.
We're assuming that you, like most Singporeans, do not live at Marina Bay or Orchard Road but in the suburban areas. And one big advantage of suburban living is that it costs less.
When you work from home or at least are able to be home whenever you want, you no longer need a membership to an expensive gym in the CBD, since there are many ClubFitt gyms in the suburbs charging $2.50 per entry. You might still be able to find hawker meals for $2.50 where you live, which is impossible in the CBD. You also have easier access to cheaper services like tailors and provision shops in HDB estates.
Finally, if you're a renter or looking to buy a home, you won't feel as much pressure to live close to the city centre. While many renters who work at Raffles Place resign themselves to paying upwards of $1,000 a month for a tiny room because it saves them time in the morning, if you don't need to regularly commute to the city for work there's nothing stopping you from renting or buying a home in less accessible areas like Bukit Panjang or Pasir Ris.
This article was originally on MoneySmart's 3 Money Saving Tips For Freelancers in Singapore
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