Smart ways to manage your savings as a Malaysian freelancer

Smart ways to manage your savings as a Malaysian freelancer

Your financial health influences your work and wellbeing as a freelance creative. Device strategies to let your finances work for you. Not against you.

By Tho Mun Yi

You’ve now reached a level of earnings where you have some surplus after covering your basic living expenses consisting of food, accommodation, utilities, transportation, and clothing. To be in good financial health, you must be able to afford health insurance, retirement funds, and investments.

Health Insurance

Getting health insurance should be your first goal. As you are not employed fulltime, you do not qualify for health benefits under an organisation or company. Without Social Security Organisation (SOCSO) contributions from an employer, you would need to be prepared to handle any medical costs that come your way.

The insurance premium varies from package to package. Generally, for 25-year-olds, insurance with a premium of RM 70 – RM 90 a month should be sufficient.

Retirement Funds

A salaried employee as well as his or her employer are required to contribute to the Employees Provident Fund (EPF). 23% – 24% of the employee’s gross income is set aside monthly, acting as a reserve for the future. Planning for your retirement is essential for all individuals, freelancing or otherwise.

Creative freelancers have the option of choosing between funding for their retirements through self contribution to EPF or the Private Retirement Schemes (PRS). As of 2019, EPF contributions are tax-deductible up to a maximum amount of RM4,000, whereas PRS contributions qualify for tax-reliefs of up to RM3,000 per year.

The advantages and disadvantages of contributing to EPF and PRS are as detailed in the following table.


If you still have excess cash after deducting the contributions to your health insurance and retirement funds, you can consider investing. The key criteria for investing is a keen interest in your investments.

There are various types of investments available. The stock market, as well as real estate, are two conventional ways of investing. Accurate foresight and the ability to discern insights from the noise are challenges for most people who are not investment-savvy.

The sheer magnitude of options in the stock market and real estate is both liberating for the savvy investor and paralysing for the inexperienced. In-depth research, knowledge, and experience are the fundamental requirements of investing in the stock market or real estate.

Although you can find a lot of information on these two categories of investments online, understanding them may prove overwhelming for the inexperienced investors. If you fall under this category, increasing your contributions to your retirement funds may prove a more beneficial passive option.

Alternatively, you can also opt to invest in less conventional investments like self-improvement, art, jewellery, or anything that you have love for, even Lego. If the investment does not go the way you intend, at least you spent your hard-earned money on something you that you can use or love.

Work towards achieving these financial goals wherever you might be in your freelance career. Having poor financial health may distract you from your creative pursuits. When you are financially healthy, you can concentrate on your craft, delivering the best work possible.

Tho Mun Yi is a Penang-based technical writer with a creative writing side hustle.