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Retirement & Health Insurance for Freelancers

February 19, 2016 by Zero Gravity Financial, LLC

Retirement & Health Insurance Freelancers

Is it possible for a freelancer making $60,000 in New York City to save for retirement and have health insurance coverage? The biggest difference between W-2 employees and freelancers is that freelancers don’t have existing HR benefits and therefore do not enroll in health insurance or retirement plans. While W-2 workers have access to established employee benefits and group insurance plans, freelancers do everything themselves: sales, marketing, operations, techonology and bookkeeping. For a freelancer, there is no time leftover to setup retirement accounts, research and signup for insurance, and enroll in other tax advantaged benefits.

Let’s take a look at 2 different scenarios of a freelancer in New York City who made a net profit of $60,000 in 2015:

In the first example, the freelancer did not contribute to a retirement plan or have health insurance coverage. They ended up paying $21,000 in Federal, New York State and City Income Taxes, including a $900 penalty for being uninsured.

In the second example, the freelancer gets NY Silver Plan health insurance coverage for the entire year, and contributes $1,200 to a Traditional IRA. As a result, they paid $3,000 less in taxes, going from owing $21,000 to $18,000. Saving for retirement and having health insurance coverage would normally cost $475/mo. However, because these benefits provide a tax deduction, it lowered the cost to $225/month.

If you are a freelancer, make time in your calendar now to do these 3 things:

  1. Review your budget. What monthly expenses can be reduced or removed by $225, how can you increase your income, or a combination of the two to make up the difference?
  2. Review health insurance plans and sign up for coverage.
  3. Open a Traditional IRA account, and setup monthly transfers of $100 to your new account.
Retirement Planning for Freelancers
Retirement Planning for Freelancers

Filed Under: Employee Benefits, Health Insurance, Saving for Retirement

IATSE NBF Q1 2016 Health Insurance Elections are due before Dec 15, 2015

December 14, 2015 by Zero Gravity Financial, LLC

IATSENBF

A reminder to make your IATSE NBF Q1 2016 Health Insurance election today. If you are trying to choose between C-2 and C-3 coverage, take a look at the comparison below of In-Network expenses.

TLDR: C-3 wins when you are just comparing In-Network coverage

click on image to enlarge

Screen Shot 2015-12-14 at 22.23.16

Filed Under: Employee Benefits, Health Insurance

IATSE NBF Oct 2015 Update

October 27, 2015 by Zero Gravity Financial, LLC

Iatse

 

Highlights from the Oct 2015 letter:

 

  • No CAPP account charge increases for the next 9 months. The new CAPP account charges that went into effect for Q4, Oct-Dec 2015 will not increase in the next 2 quarters through the end of June 2016.
  • Use it or lose it. Don’t lose employer contributions for your health insurance coverage. If your CAPP account is inactive more than 24 months, the balance will be forfeited.
  • Time to get married or lose health insurance coverage. Domestic partner coverage is coming to an end. As of Jan 1 2016, you must be married to receive health insurance benefits.

 

Full letter is here.

Filed Under: Employee Benefits, Health Insurance

How to Choose a Health Insurance Plan

December 18, 2014 by Zero Gravity Financial, LLC

Health Insurance Comparison

 

‘Tis the season for health insurance open enrollment. Here is a health insurance comparison infographic that compares 4 different plans and gives 3 examples of medical coverage for each one. This information is based on an individual using Freelancers Union Plans:

Filed Under: Health Insurance

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