To contract or not?
-
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
-
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
-
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
-
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:
-
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
-
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.
-
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.
-
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
-
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.
I've been a contracting now for almost 20 years. About 5 yrs ago I was in a bad position where I worked on a big project for 1.5 yrs. During this time I had no time to search for other contracting work and the bad part, when I finished the project, I was left with no job for 8 months. Very... Very bad... But then I found another job, A PERMANENT job !!! Working there for one year, I one morning got a letter on my table stating, sorry we are closing down the department, you are not required anymore, you have ONE MONTH. I was without a job again for 3 months and then was lucky to get three contracts and is now outsourcing. Let me tell you the lessons I've learned, NEVER depend only only on one client, while contracting look for the next contract, you MUST always be in a position where you can choose between two or more contracts. There is NO JOB SECURITY with a permanent job, having my permanent job gave me a one month notice, while contracting I have a minimum of three to six month notice of no work. Generally you score on tax if you contract, specially if you have more than 3 clients. Well, country laws depict this. Anyway, the best part.... you are not working for somebody else. Enjoy, go contracting, it is worth it and very interesting. cheers
-
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.
IMHO, your level of experience is not going to count for much. I have NEVER won a job based on qualifications and past experience. I have ALWAYS won work by being able to sell myself and grab opportunities that arise, and I have done significant amounts of repeat work based on first experiences with a new client. I suppose what I'm getting at is you need a marketing/promotional ability as well. Two truths exist when contracting above all others. If you don't do it no one else will. No one else is going to win you a job. I've been lucky in that I am able to sell myself and I get out and about to various networking groups. I have also formed some close alliances with other contractors/companies. For example I work closely with a web designer and as a result do nearly all of his development work. To sum up, yes you can make significantly more money as a contractor, and enjoy a better quality of life etc. However, the question is not whether its better, the question is whether its for you. If you don't enjoy "pressing the flesh" and selling yourself, then it could be an uphill battle, but like I have said there other ways to get work work like allying yourself with someone who is good at it. You will find yourself doing long hours, trying to keep several clients happy at the same time, but the difference is, you receive the benefit of long hours, not your employer. Oh and for the record, I'd never go back to employment :) Hope this help.
The only thing unpredictable about me is just how predictable I'm going to be.
-
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.
It really depends on your circumstances; if it's something that excites you and you really want to try it, I'd recommend staying in FTE for another 12 months and saving up a couple months wages on the side, if you can. Spend the first month of contracting reviewing how many jobs you're getting in and maybe limit yourself to 2 at a time (if you get lucky). After the first month, if you're finding it's not very fruitful then maybe return to FTE and do a few jobs on the side - that couple months wages you saved earlier could cover you while you find the right job. But yes, waiting until you've got a few more years' experience under your belt is a decent idea. I suppose it also depends on what your outgoings are - at the moment, I myself wouldn't risk going into contracting, and risk is the keyword here. :~
What would you rather bee or a wasp?
-
Marc 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
Nishant Sivakumar wrote:
But it does help lower your cost of living, right?
Actually, no. Things are quite expensive here. Houses, heating fuel, gasoline, food, etc. It certainly is no cheaper, and I was just talking to someone who comes from Detroit, and she said the cost of living is considerably higher out here. Of course, employment opportunities in Detroit don't sound very attractive either. The only thing I save on is car expenses. I drive about 5 miles a day, shuffling Ian between home and the busstop and occasionally going to the school or a local client. Once a month I drive to Albany for a usergroup meeting. On the other hand, my girlfriend as a 20 mile commute (one way) each day. Which is pathetic. I'm making 6 to 8 times what she makes, and she's the one with the commute! 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 SmithActually self-employment tax is only an extra 7.65%. As a W-2 employee, you pay social security and medicare (which amount to 7.65%) and your employer pays the other half. As a self-employed person, you pay both parts (15.3%). As for health insurance, I am a self-employed consultant and before I got married (now I fall under the wife's coverage) I had a Blue Cross/Blue Shield PPO here in Florida for $300 a quarter. It was good coverage. I am 37, have a clean health record (knock on wood) and came out of the military, so that might have helped with the low rate. Depending on who you work for (I still work for the US Air Force), the client may pay travel and equipment. They may even send you to specialized training depending on the situation. I do realize these last two probably are the exception rather than the rule. Steve
-
Actually self-employment tax is only an extra 7.65%. As a W-2 employee, you pay social security and medicare (which amount to 7.65%) and your employer pays the other half. As a self-employed person, you pay both parts (15.3%). As for health insurance, I am a self-employed consultant and before I got married (now I fall under the wife's coverage) I had a Blue Cross/Blue Shield PPO here in Florida for $300 a quarter. It was good coverage. I am 37, have a clean health record (knock on wood) and came out of the military, so that might have helped with the low rate. Depending on who you work for (I still work for the US Air Force), the client may pay travel and equipment. They may even send you to specialized training depending on the situation. I do realize these last two probably are the exception rather than the rule. Steve
PSU Steve wrote:
Actually self-employment tax is only an extra 7.65%.
Ah, good point. Thanks for the clarification.
PSU Steve wrote:
I had a Blue Cross/Blue Shield PPO here in Florida for $300 a quarter.
Wow. That's amazing. I'm going to have to look into this again.
PSU Steve wrote:
the client may pay travel and equipment
Actually, yes, my clients have always paid for travel, and one client has sent me two top-of-the-line dev boxes over the last year. Not to mention all the various custom hardware and stuff needed for the project as well. 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.
chambers-chris wrote:
I'm keen to know what other people out there think too.
Do you have a lot of self-discipline?
"A good athlete is the result of a good and worthy opponent." - David Crow
"To have a respect for ourselves guides our morals; to have deference for others governs our manners." - Laurence Sterne
-
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.
I was a contractor for about 3 1/2 years. Though the security was less than that of an employee I much preferred not being a part of the corporate nonsense that is so invested in many companies today. Now, I have just accepted a position as a software engineer at a small, successful start-up. Contracting however, appears to be somewhat of a geographic thing. In the New York metro area it is very difficult to survive comfortably as a contractor as the companies make it impossible for you to be flexible in terms of rates and as such much prefer to hire currently. This may not be as true in New Jersey however. One thing you may want to consider is remote-contracting where you advertise your services on the Internet as well as locally. A colleague of mine was doing this part-time in 2000 and was doing quite well with it. All he did was Access development but told me he was doing well enough that he could have done it full-time. Only problem was, he had to pay for all his benefits which he wasn't willing to do at the time.
Steve Naidamast Black Falcon Software, Inc. blackfalconsoftware@ix.netcom.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
Patrick Sears wrote:
Any hints on where to find these magic bean - I mean, contracting companies?
My experience shows that a job search on dice.com will net at least 60% contracting companies fishing for contractors. On there at least, I assume that the job is contract unless it specificially says "Full time W2". I'm probably wrong about this, but that has been my observation in the Salt Lake City and Atlanta markets. I probably should go the contract direction, but with 4 kids and one on the way, my main concern has been finding decent health care coverage. My main reason why I would want to go this way is that I seem to get bored with jobs after about 8 months, which doesn't hold well when your wife wants stability in life (her dad owns his own home design business, and she grew up with feast and famine in the same month more than once).
Success is the happy feeling you get between the time you do something and the time you tell a woman what you did. --Dibert My left name is Tremendous Savings, Ms. America – Señor Cardgage
-
chambers-chris wrote:
I'm keen to know what other people out there think too.
Do you have a lot of self-discipline?
"A good athlete is the result of a good and worthy opponent." - David Crow
"To have a respect for ourselves guides our morals; to have deference for others governs our manners." - Laurence Sterne
DavidCrow wrote:
Do you have a lot of self-discipline?
Short answer - Yes. Do you think self-discipline is the key to contracting?