To contract or not?
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Hi everyone, A friend of mine that I work with has handed his notice in with the intent to return to contracting, mainly because of the extra money and benefit of being his own boss. I also intended to go contracting myself at some point in the near future and so, naturally, we ended up talking about my situation. He said (and I think I agree with him) that a contractor really needs a good 4-5 years solid experience before making a go of it, however he also said that he knows of a few people that went for it straight out of university and have done really well for themselves. I'm keen to know what other people out there think too. I've been working as a full time software engineer for a little over a year, am 24 with a background in electronic hardware design/embedded firmware. Cheers, Chris.
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Hi everyone, A friend of mine that I work with has handed his notice in with the intent to return to contracting, mainly because of the extra money and benefit of being his own boss. I also intended to go contracting myself at some point in the near future and so, naturally, we ended up talking about my situation. He said (and I think I agree with him) that a contractor really needs a good 4-5 years solid experience before making a go of it, however he also said that he knows of a few people that went for it straight out of university and have done really well for themselves. I'm keen to know what other people out there think too. I've been working as a full time software engineer for a little over a year, am 24 with a background in electronic hardware design/embedded firmware. Cheers, Chris.
chambers-chris wrote:
mainly because of the extra money
:laugh: :laugh: :laugh: Self-employment tax: an additional 15% of your income Health Insurance: $3K-$4K / yr, if you can even get it, and then it's crappy anways Education, Equipment, Travel, etc: Easily $5K - $20K per year Long hours of work: priceless Long days of no work: worthless Tell your friend to think again. On the other hand, I would never go back to being a prostitute employee for a company unless there were very special and good reasons. Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh Smith -
chambers-chris wrote:
mainly because of the extra money
:laugh: :laugh: :laugh: Self-employment tax: an additional 15% of your income Health Insurance: $3K-$4K / yr, if you can even get it, and then it's crappy anways Education, Equipment, Travel, etc: Easily $5K - $20K per year Long hours of work: priceless Long days of no work: worthless Tell your friend to think again. On the other hand, I would never go back to being a prostitute employee for a company unless there were very special and good reasons. Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh SmithMarc, so does being a full-time contractor generally pay less than working for a company?
Tech, life, family, faith: Give me a visit. I'm currently blogging about: Virginia Tech Shootings, Guns, and Politics The apostle Paul, modernly speaking: Epistles of Paul Judah Himango
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Marc, so does being a full-time contractor generally pay less than working for a company?
Tech, life, family, faith: Give me a visit. I'm currently blogging about: Virginia Tech Shootings, Guns, and Politics The apostle Paul, modernly speaking: Epistles of Paul Judah Himango
Judah Himango wrote:
does being a full-time contractor generally pay less than working for a company
Did you mean in $ or in self-respect?;P
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Marc, so does being a full-time contractor generally pay less than working for a company?
Tech, life, family, faith: Give me a visit. I'm currently blogging about: Virginia Tech Shootings, Guns, and Politics The apostle Paul, modernly speaking: Epistles of Paul Judah Himango
My short experience is that I am making much more than I did as a FTE. But, you have to pay your own employment taxes as well as benefits if you need them. In my case I don't because my wife loves her j.o.b. and has excellent benefits. And, to follow what Rob said, I've never been this happy as an employee.
My Blog A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects. - -Lazarus Long
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Hi everyone, A friend of mine that I work with has handed his notice in with the intent to return to contracting, mainly because of the extra money and benefit of being his own boss. I also intended to go contracting myself at some point in the near future and so, naturally, we ended up talking about my situation. He said (and I think I agree with him) that a contractor really needs a good 4-5 years solid experience before making a go of it, however he also said that he knows of a few people that went for it straight out of university and have done really well for themselves. I'm keen to know what other people out there think too. I've been working as a full time software engineer for a little over a year, am 24 with a background in electronic hardware design/embedded firmware. Cheers, Chris.
The question you should ask yourself may just be "Will I ever be happy as an employee?" If the answer is no, then contracting or building a business that you enjoy and meets your finical needs may be the way to go. I tried for the better part of a decade to be a happy employee and it never worked for me. I've been contracting and building a business and I am a much happier person. All in all, it really is a personal decision that no one can really answer for you.
My Blog A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects. - -Lazarus Long
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chambers-chris wrote:
mainly because of the extra money
:laugh: :laugh: :laugh: Self-employment tax: an additional 15% of your income Health Insurance: $3K-$4K / yr, if you can even get it, and then it's crappy anways Education, Equipment, Travel, etc: Easily $5K - $20K per year Long hours of work: priceless Long days of no work: worthless Tell your friend to think again. On the other hand, I would never go back to being a prostitute employee for a company unless there were very special and good reasons. Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh Smith -
Hi everyone, A friend of mine that I work with has handed his notice in with the intent to return to contracting, mainly because of the extra money and benefit of being his own boss. I also intended to go contracting myself at some point in the near future and so, naturally, we ended up talking about my situation. He said (and I think I agree with him) that a contractor really needs a good 4-5 years solid experience before making a go of it, however he also said that he knows of a few people that went for it straight out of university and have done really well for themselves. I'm keen to know what other people out there think too. I've been working as a full time software engineer for a little over a year, am 24 with a background in electronic hardware design/embedded firmware. Cheers, Chris.
The important thing to understand is that there are essentially two kinds of contracting. In a truly independent scenario, you chase down your own gigs, do your own invoicing and get 100% of the invoice. As others have mentioned, you also get 100% of the expenses. Nonetheless, a lot of people make it work. A second and somewhat lower risk scenario is working through one of the gazillion contracting companies out there. In the US at least, the way it usually works is that you're paid by the hour for every hour you work, but you're a W2 employee of the contracting company you happen to be working for at the moment. This means that they do the normal withholding and you don't get hit with self employment taxes. Additionally, most of them offer insurance as well. You won't get 100% of the billing rate as the contracting company has to make a living, too. However, you get paid every two weeks regardless of whether the client pays them or not. Although I've done both, the overwhelming majority of work I've done as a mercenary since '93 has been through these companies, and it's worked out well for me. When a gig is winding down, there are dozens of recruiters competing to hire you for the next one. As for your experience, much of it really boils down to supply and demand. A C# guy with a year of experience will have a much easier time finding a gig than a COBOL guy with twenty. My advice? Build relationships with as many recruiters as you can. They may not have a gig for you this time, but if you're nice to talk to and conduct yourself well, they'll certainly remember you when they do. Multiply this by dozens of recruiters and you have an excellent sales force out there hustling gigs for you. I say go for it. Just put some money in the bank each check in case you have a gap between gigs. It's a great way to make a living.
Author of The Career Programmer and Unite the Tribes www.PracticalStrategyConsulting.com
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Judah Himango wrote:
does being a full-time contractor generally pay less than working for a company
Did you mean in $ or in self-respect?;P
I realize you're at the mercy of an employer, to do every crazy thing they dream up, to be in by X and leave not before Y, to dress up and look respectable, to work with others. :) So being self-employed is certainly more attractive in that sense, I realize, since those things don't always apply with contracting. I'm talking about money. I make about 70K working for a small company here in MN. The working conditions are very accommodating and flexible. Dress code is non-existant. :) If you account for paying for your own health, dental, etc. does contracting still pay more? p.s. mind if I ask how much you charge/hour? *edit* just realized you're Rob, not Marc. ;P
Tech, life, family, faith: Give me a visit. I'm currently blogging about: Virginia Tech Shootings, Guns, and Politics The apostle Paul, modernly speaking: Epistles of Paul Judah Himango
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The important thing to understand is that there are essentially two kinds of contracting. In a truly independent scenario, you chase down your own gigs, do your own invoicing and get 100% of the invoice. As others have mentioned, you also get 100% of the expenses. Nonetheless, a lot of people make it work. A second and somewhat lower risk scenario is working through one of the gazillion contracting companies out there. In the US at least, the way it usually works is that you're paid by the hour for every hour you work, but you're a W2 employee of the contracting company you happen to be working for at the moment. This means that they do the normal withholding and you don't get hit with self employment taxes. Additionally, most of them offer insurance as well. You won't get 100% of the billing rate as the contracting company has to make a living, too. However, you get paid every two weeks regardless of whether the client pays them or not. Although I've done both, the overwhelming majority of work I've done as a mercenary since '93 has been through these companies, and it's worked out well for me. When a gig is winding down, there are dozens of recruiters competing to hire you for the next one. As for your experience, much of it really boils down to supply and demand. A C# guy with a year of experience will have a much easier time finding a gig than a COBOL guy with twenty. My advice? Build relationships with as many recruiters as you can. They may not have a gig for you this time, but if you're nice to talk to and conduct yourself well, they'll certainly remember you when they do. Multiply this by dozens of recruiters and you have an excellent sales force out there hustling gigs for you. I say go for it. Just put some money in the bank each check in case you have a gap between gigs. It's a great way to make a living.
Author of The Career Programmer and Unite the Tribes www.PracticalStrategyConsulting.com
Christopher Duncan wrote:
A second and somewhat lower risk scenario is working through one of the gazillion contracting companies out there. In the US at least, the way it usually works is that you're paid by the hour for every hour you work, but you're a W2 employee of the contracting company you happen to be working for at the moment. This means that they do the normal withholding and you don't get hit with self employment taxes. Additionally, most of them offer insurance as well.
Any hints on where to find these magic bean - I mean, contracting companies? I'm not in a place right now to do it, but it is definitely something I have considered...
Cheers, Patrick
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Christopher Duncan wrote:
A second and somewhat lower risk scenario is working through one of the gazillion contracting companies out there. In the US at least, the way it usually works is that you're paid by the hour for every hour you work, but you're a W2 employee of the contracting company you happen to be working for at the moment. This means that they do the normal withholding and you don't get hit with self employment taxes. Additionally, most of them offer insurance as well.
Any hints on where to find these magic bean - I mean, contracting companies? I'm not in a place right now to do it, but it is definitely something I have considered...
Cheers, Patrick
These days, the easiest thing to do is post on all the techie job sites and select contracting as a category. If you have an even moderately popular skill set, they'll be coming out of the woodwork. At that point, take the time and trouble to build a database, and keep track of the folks you talk to. You'll be surprised at how many companies you hear from and how quickly the database builds. Some will be drooling idiots, some will be unethical, some will rock, and most will be just average folks trying to make a living. Make a personal connection, keep notes, and conduct yourself in such a way as to make yourself memorable. All things being equal (and they frequently are in this scenario), people remember personality and those who obviously have their act together when it comes to taking care of business. Anyone can code. You'd be surprised how few truly dependable & easy to work with people there are out there. Be one of them, and you'll stand out in a crowd.
Author of The Career Programmer and Unite the Tribes www.PracticalStrategyConsulting.com
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Marc, so does being a full-time contractor generally pay less than working for a company?
Tech, life, family, faith: Give me a visit. I'm currently blogging about: Virginia Tech Shootings, Guns, and Politics The apostle Paul, modernly speaking: Epistles of Paul Judah Himango
Judah Himango wrote:
so does being a full-time contractor generally pay less than working for a company?
Well, the key phrase is "full-time contractor". The risk of contract work is the downtime. To avoid downtime means marketting oneself. So where does the marketting time come in? Does it cut into personal time, or the full time work? So, in theory it should be at least as well, factoring in all the self-employment costs. The real benefits, IMO, is the flexibility, staying somewhat disconnected from company politics, and working on really neat stuff rather than often getting locked into a particular technology/product. Personally, I've never been able to break through the barrier of getting enough work to hire farm it out. Of course, living in the boonies of upstate NY doesn't help with the "face thing". Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh Smith -
Judah Himango wrote:
so does being a full-time contractor generally pay less than working for a company?
Well, the key phrase is "full-time contractor". The risk of contract work is the downtime. To avoid downtime means marketting oneself. So where does the marketting time come in? Does it cut into personal time, or the full time work? So, in theory it should be at least as well, factoring in all the self-employment costs. The real benefits, IMO, is the flexibility, staying somewhat disconnected from company politics, and working on really neat stuff rather than often getting locked into a particular technology/product. Personally, I've never been able to break through the barrier of getting enough work to hire farm it out. Of course, living in the boonies of upstate NY doesn't help with the "face thing". Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh SmithMarc Clifton wrote:
I've never been able to break through the barrier of getting enough work to hire farm it out.
Marc, do you think this is purely geographical and self marketing? Could it also be due to how much you are willing to commit to contracting time? I have a friend who has over committed his time and he is miserable and may as well stayed at his job. Personally, I am trying to under-commit in terms of hours that I can spend working on my clients project so that I can over-deliver for my first year or two of being a contractor. I figure the key to my long-term success as a contractor/consultant will be repeat business. I hope that makes sense :)
My Blog A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects. - -Lazarus Long
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Marc Clifton wrote:
I've never been able to break through the barrier of getting enough work to hire farm it out.
Marc, do you think this is purely geographical and self marketing? Could it also be due to how much you are willing to commit to contracting time? I have a friend who has over committed his time and he is miserable and may as well stayed at his job. Personally, I am trying to under-commit in terms of hours that I can spend working on my clients project so that I can over-deliver for my first year or two of being a contractor. I figure the key to my long-term success as a contractor/consultant will be repeat business. I hope that makes sense :)
My Blog A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects. - -Lazarus Long
Chris Austin wrote:
do you think this is purely geographical and self marketing?
Somewhat. But also because, when you meet someone and sell yourself, you are selling yourself, not some guy under you that nobody knows. At least, I think that's the psychology of it. I really haven't figured it out, but I do know that if I lived in San Diego or SF or NYC or Boston or some other major metropolitan area, I could find a lot more contract work. People are rather reluctant to have offsite people work for them, it seems. And everything for me is a major commute, except Albany. I'm working on the Albany market with a partner. Speaking of which, partnering up with other consultants is really a good way to go, I think.
Chris Austin wrote:
I am trying to under-commit in terms of hours that I can spend working on my clients project so that I can over-deliver for my first year or two of being a contractor.
Even as an employee, I've learned that over-delivering results in over-delivery expectations, which results in over-committing. Repeat business is definitely important but I wouldn't put to many eggs in that basket. A couple clients, I've done what they've wanted, we go our different ways for a while, and a year or two later they call back with a new project. Of course, everyone's experiences as a consultant are bound to be different. It'd be interesting to get some of us in a room and share stories. Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh Smith -
Chris Austin wrote:
do you think this is purely geographical and self marketing?
Somewhat. But also because, when you meet someone and sell yourself, you are selling yourself, not some guy under you that nobody knows. At least, I think that's the psychology of it. I really haven't figured it out, but I do know that if I lived in San Diego or SF or NYC or Boston or some other major metropolitan area, I could find a lot more contract work. People are rather reluctant to have offsite people work for them, it seems. And everything for me is a major commute, except Albany. I'm working on the Albany market with a partner. Speaking of which, partnering up with other consultants is really a good way to go, I think.
Chris Austin wrote:
I am trying to under-commit in terms of hours that I can spend working on my clients project so that I can over-deliver for my first year or two of being a contractor.
Even as an employee, I've learned that over-delivering results in over-delivery expectations, which results in over-committing. Repeat business is definitely important but I wouldn't put to many eggs in that basket. A couple clients, I've done what they've wanted, we go our different ways for a while, and a year or two later they call back with a new project. Of course, everyone's experiences as a consultant are bound to be different. It'd be interesting to get some of us in a room and share stories. Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh SmithMarc Clifton wrote:
Even as an employee, I've learned that over-delivering results in over-delivery expectations
Way too True. I'll have to keep this in mind. The second I read it the "memories" flooded back :)
My Blog A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects. - -Lazarus Long
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Hi everyone, A friend of mine that I work with has handed his notice in with the intent to return to contracting, mainly because of the extra money and benefit of being his own boss. I also intended to go contracting myself at some point in the near future and so, naturally, we ended up talking about my situation. He said (and I think I agree with him) that a contractor really needs a good 4-5 years solid experience before making a go of it, however he also said that he knows of a few people that went for it straight out of university and have done really well for themselves. I'm keen to know what other people out there think too. I've been working as a full time software engineer for a little over a year, am 24 with a background in electronic hardware design/embedded firmware. Cheers, Chris.
Wish my waist would :sigh:
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Judah Himango wrote:
so does being a full-time contractor generally pay less than working for a company?
Well, the key phrase is "full-time contractor". The risk of contract work is the downtime. To avoid downtime means marketting oneself. So where does the marketting time come in? Does it cut into personal time, or the full time work? So, in theory it should be at least as well, factoring in all the self-employment costs. The real benefits, IMO, is the flexibility, staying somewhat disconnected from company politics, and working on really neat stuff rather than often getting locked into a particular technology/product. Personally, I've never been able to break through the barrier of getting enough work to hire farm it out. Of course, living in the boonies of upstate NY doesn't help with the "face thing". Marc
People are just notoriously impossible. --DavidCrow
There's NO excuse for not commenting your code. -- John Simmons / outlaw programmer
People who say that they will refactor their code later to make it "good" don't understand refactoring, nor the art and craft of programming. -- Josh SmithMarc Clifton wrote:
Of course, living in the boonies of upstate NY doesn't help with the "face thing".
But it does help lower your cost of living, right?
Regards, Nish
Nish’s thoughts on MFC, C++/CLI and .NET (my blog)
C++/CLI in ActionFly on your way like an eagle Fly as high as the sun On your wings like an eagle Fly and touch the sun
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Hi everyone, A friend of mine that I work with has handed his notice in with the intent to return to contracting, mainly because of the extra money and benefit of being his own boss. I also intended to go contracting myself at some point in the near future and so, naturally, we ended up talking about my situation. He said (and I think I agree with him) that a contractor really needs a good 4-5 years solid experience before making a go of it, however he also said that he knows of a few people that went for it straight out of university and have done really well for themselves. I'm keen to know what other people out there think too. I've been working as a full time software engineer for a little over a year, am 24 with a background in electronic hardware design/embedded firmware. Cheers, Chris.
To make really good money as a contractor, you should pick a niche market - for example, working on programming/customising industrial robots. $100-200/hr. Requires a lot of travel, though.
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I realize you're at the mercy of an employer, to do every crazy thing they dream up, to be in by X and leave not before Y, to dress up and look respectable, to work with others. :) So being self-employed is certainly more attractive in that sense, I realize, since those things don't always apply with contracting. I'm talking about money. I make about 70K working for a small company here in MN. The working conditions are very accommodating and flexible. Dress code is non-existant. :) If you account for paying for your own health, dental, etc. does contracting still pay more? p.s. mind if I ask how much you charge/hour? *edit* just realized you're Rob, not Marc. ;P
Tech, life, family, faith: Give me a visit. I'm currently blogging about: Virginia Tech Shootings, Guns, and Politics The apostle Paul, modernly speaking: Epistles of Paul Judah Himango
Judah Himango wrote:
p.s. mind if I ask how much you charge/hour?
I'm not Rob or Marc, but when I was contracting in the mid-90s, I charged between $75 and $100 per hour, depending on the nature of the job. In theory, I could have grossed 200K per year, but there is occasional downtime between jobs and it's nice to have a few days off once in a while, so 140-150K is more realistic. Then, as Marc pointed out, there are taxes and expenses to cover.
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To make really good money as a contractor, you should pick a niche market - for example, working on programming/customising industrial robots. $100-200/hr. Requires a lot of travel, though.
Hans Dietrich wrote:
working on programming/customising industrial robots. $100-200/hr. Requires a lot of travel, though.
Oddly enough I turned down an opportunity to do just that about 7 months ago because of the travel. In my twenties I was on the road 90% of the time, I guess I've had my fill. But, I'd love the domain.
My Blog A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects. - -Lazarus Long