Key Takeaways
- COBRA permits eligible W-2 freelancers to maintain their well being protection for as much as 18 months after an task ends.
- Some staffing companies, like Aquent, require freelancers to work solely 20 hours per week to qualify for group advantages on future assignments.
- Understanding choices for retirement plans, HSAs, FSAs, and re-enrollment may help freelancers keep away from expensive gaps and make smarter monetary choices.
Many freelancers really feel relieved to be taught that partnering with a staffing company means they not need to go it alone with advantages. Practically half of freelancers report issue accessing medical insurance, and 23% say they haven’t any protection in any respect.
Taking up an task by means of a staffing company can provide useful assist, similar to entry to advantages for freelancers, group-rate pricing, and different perks. And whereas having high quality advantages throughout a mission is a large benefit, what occurs when that mission wraps up?
The excellent news is that simply because your task ends, it doesn’t imply your advantages need to. Understanding your choices may help you are taking the perfect subsequent steps whilst you’re between gigs.
Understanding your freelance medical insurance choices
Many face excessive deductibles and costly plans when searching for medical insurance for freelancers. However while you work with a staffing company, you’ll be able to typically entry premium advantages at decrease group charges. Whereas your protection often ends together with your task, that doesn’t imply you’re out of choices. Right here are some things to contemplate with regards to medical insurance.
COBRA may help you preserve protection
COBRA is a federal regulation that enables workers and their households to proceed group well being protection after a job loss or one other qualifying occasion, similar to the top of a W-2 freelance task. Typically, you’ll be able to maintain your present medical insurance as a freelancer for as much as 18 months, and generally as much as 36 months, relying in your scenario. A few issues to bear in mind:
- You will be chargeable for the complete premium, for the reason that staffing company will not subsidize the price.
- Your protection and deductible historical past often stay intact in case you keep on the identical plan and throughout the identical calendar 12 months.
It’s possible you’ll be eligible for well being advantages once more while you return
Do you take pleasure in working together with your staffing company? In that case, allow them to know you’re open to new alternatives. While you land your subsequent gig, it’s possible you’ll be eligible to re-enroll in group advantages for freelancers. Some companies, like Aquent, require solely a mean of 20 hours per week to qualify. So you could possibly tackle a smaller mission and nonetheless maintain the flexibleness so as to add extra work because it comes.
Understanding your retirement plan standing
Some freelancers fear that short-term assignments don’t make utilizing a staffing company’s retirement plan value it. Nevertheless, in case your company affords a 401(ok), particularly with matching contributions, even a brief mission may help you develop your financial savings rapidly. That mentioned, it’s necessary to know precisely what occurs when the mission ends.
A great start line is to ask in regards to the vesting schedule for employer-matched contributions. Are you absolutely vested from day one, or does a schedule apply? If it’s the latter, that schedule will decide how a lot of the matched funds you’ll be able to take with you.
Subsequent, ensure you perceive your choices for a way and the place to maneuver your retirement funds when your task ends. Frequent choices embody:
- Leaving your funds within the present 401(ok) plan. Test together with your retirement supplier to see if that is accessible.
- Rolling them into an IRA or one other employer-sponsored plan.
- Cashing them out.
Conserving your funds within the present plan or rolling them into one other qualifying plan may help you keep away from pointless prices. Cashing out, alternatively, might include tax implications that set you again.
What to learn about HSAs, FSAs, and paid day off
Do you could have a well being financial savings account (HSA) or a versatile spending account (FSA)? In that case, it’s necessary to know which funds can include you, which may’t, and any guidelines that apply.
For instance, HSAs are often tied to high-deductible well being plans and are moveable below sure circumstances. FSAs, alternatively, sometimes comply with a “use it or lose it” rule, so these funds might not carry over from one 12 months to the following.
It’s additionally value checking in your paid day off. Whereas many staffing companies don’t provide conventional trip time, some now present paid sick depart—Aquent was one of many early adopters. Ask what occurs to any unused time. Is it paid out, or do you lose it? Your staffing company may help make clear the small print.
Do not forget about re-enrollment
Constructing a powerful relationship together with your staffing company generally is a large assist in case you’re hoping to land extra assignments sooner or later. Whereas some tasks have agency finish dates, companies typically have new roles to fill, and one may be an incredible match to your abilities and availability. In that case, you could possibly enroll in group advantages for freelancers once more.
Understanding the re-enrollment course of may help you keep away from surprises or gaps in protection. Take into account asking your company:
- What is the course of for re-enrolling in advantages?
- Will my earlier deductible and co-insurance funds carry over?
- How do I requalify, and is there a ready interval?
When you return throughout the identical calendar 12 months, your deductible might reset, relying on the timing and the company’s insurance policies.
Making ready for the longer term
The character of freelance work is consistently in flux, however while you work with a staffing company, you’ll be able to benefit from the flexibility and advantages for freelancers that provide help to really feel supported. And even when your mission ends, somewhat planning may help you’re feeling extra ready for the hole between assignments and be prepared for no matter comes subsequent.
Are you planning to your subsequent freelance task? Ask these 5 necessary questions on advantages that can assist you resolve which alternative is the perfect match.
