26th August 2016 - 4 min read
If you are about to hand in your permanent-job badge and look for something more in the way of fewer working hours and greater flexibility, then you’re probably thinking of getting part-time job or even freelancing.
Between the two, which do you think has a better outlook? Let’s review the advantages and disadvantages of both freelance and part-time positions:
Directly offering your skills, talent, effort, and time to clients and customers is one way to go about working without having to be employed full-time. But how does it compare to working part-time?
High Income Possibility: Earning possibilities mimic that of sole proprietors in that you are essentially running a small business. This means your money-making capabilities have no ceiling, i.e. you could make a lot by freelancing, sometimes way more than if you applied the same skills to a steady employer.
No Office Politics: Once you are armed with strong savings, you can actually get out of negative work relationships relatively easily by declining future projects from certain clients. This is why there is a ‘free’ in freelance after all.
Flexible Work Schedule: Since freelancers manage their own schedules, their work-life balance can be better managed. In fact, this is probably one of the most advertised reasons for why millennials get into freelance positions.
No Automatic Coverage or Benefits: Freelancers lose out on corporate benefits such as medical compensation, employer contributions to the Employees Provident Fund (EPF) or SOCSO and the like. They don’t have the benefit of claiming medical leave and still receiving a paycheque at the end of the month.
Riskier Income: Just like running a sole proprietorship or any other business, there are no guarantees of income with freelancing – no steady paycheque and no assurance that clients will pay as promised. Yes, you can definitely earn more while freelancing, but you have to work a lot harder to get there.
The close cousin to working full-time, and the first jobs of many young Malaysians out there post-SPM. You can definitely continue earning steady cash long afterwards of course, but how does it stack up against freelancing?
Benefits and Coverage: If as a part-timer you earn less than RM1,500 (and work 70% fewer hours than a full-time employee), the Employment Act states that you are still entitled to EPF and SOCSO contributions by employers.
In addition, you should also be eligible for annual leave, public holidays, sick leave and overtime compensation. Some companies may still offer such benefits even if you draw a higher wage.
Fixed and Guaranteed Income: Wages earned are typically fixed like a salary. Also, they face fewer risks than freelancers in terms of having a predictable income and when contracted; companies are liable to uphold payments. Part-timers can also seek compensation owed through labour services if employers fail to pay wages.
Less Flexible Work Schedule: Typically, this group of workers have the same accountability as permanent employees, which include specified work hours, lunch breaks and the like.
Coworkers: You can’t drop a disagreeable client or boss when you are employed, even if it is just part-time. If you’ve been contracted to work 4-days a week under a difficult superior, office-politicking colleagues and a generally uncomfortable work environment – you’ll likely spend it counting the days to your next position.
There’s a lot to think about if you’re choosing which of these two routes to go with, and we hope this comparison can help you make a more informed decision. Which one do you think is better? Let us know in the comments section down below!
Making an attractive side income with freelancing or working part-time? Be sure to put your hard-earned cash somewhere safe and where it can grow, like a high-interest Fixed Deposit account. Visit our comparison page to find one that suits your needs.
Subscribe to our exclusive weekly newsletter and we’ll bring you the week’s highlights of financial news, expert tips, guides, and the latest credit card and e-wallet deals.
Stay tuned for what’s to come next in the personal finance world