Retirement Planning Without an Employer

When you freelance, there is no employer contributing to your provident fund, no EOBI deductions building a safety net, and no gratuity waiting for you at the end of a long career. Retirement planning is entirely your responsibility — and the sooner you start, the better. The good news is that the tax savings from the 0.25% regime give you significantly more capital to invest for retirement than a comparable salaried employee.

This chapter will provide a comprehensive guide to retirement planning for Pakistani freelancers. We will cover how to calculate your retirement number (how much you need to retire comfortably in Pakistan), the FIRE (Financial Independence, Retire Early) movement and its applicability to Pakistani freelancers, and specific strategies for building a retirement corpus using a mix of Pakistani and international investments.

We will also explore Voluntary Pension Systems (VPS) offered by Pakistani AMCs, which provide tax deductions on contributions and are one of the few formal retirement vehicles available to self-employed individuals in Pakistan. The chapter will include model retirement plans for freelancers at different income levels and life stages.