The financial benefits on contracting don't seem worth it

[denBen]

Let's say you are a jack of all trades .NET developer with nothing special about your skillset. Five years experiences and you are earning £35,000 with a take home pay of about £27,000. That is the average developer salary in the UK.

Now consider that in your area the market rate for such a contractor is about £300/day, maybe £350. Well, and working on the assumption that you will be working 7 months per year (which is a rule of thumb I have read), your take home pay would be about £35,000 per year. I know there are no certainties with this as taxation and contracting, along with rates and work, are uncertain, but let's try and have a discussion here.

That would have you £8,000 per year better off. That's not to be sniffed at, but it's not exactly a huge amount if you are in contracting primarily for the money.

Am I completely off the mark here or is this what contracting has to offer? I have only begun looking into it with real intent recently, but I am not sure it's worth the hassle for that kind of pay rise.

[cojak]

If you're just in it for the money then it isn't worth the hassle.

[Contreras]

Think about what you could be doing with that other 5 months of the year not tied to a desk.

[The Spartan]

Think about what you could be doing with that other 5 months of the year not tied to a desk.

Exactly contracting is not just about the money though it is a benefit if you're at the top of your craft, for me it was about flexibility, new challenges and a chance to show the doubters that I have big brass cojones.

[Batcher]

Think about what you could be doing with that other 5 months of the year not tied to a desk.

I had one year with 8 months on the bench. The first three were by choice for the break and the rest I worked on Plan B until the market improved so I did have some money flowing through the business. I really enjoyed working on something other than IT systems and I continue to do it in my spare time. I will eventually retire from IT and do Plan B part-time I think.

I wouldn't have had the chance to do it as a permie so there is a lot more to contracting than the money.

Other than that I've only had 2 years with 3-month breaks in 18 years of contracting. The rest is normal 2-4 week holidays when i can fit them in.

[Scrag Meister]

I call troll/sockie.

So the OP had 5 months of a year when perm? Not even comparing the same thing.

Work 7 month and get the extra 8k, then work 4 of the other 5 for the extra 25k!!!!

My perm to contract switch was an increase of 2.5 times perm income.

At least try and compare apples with apples.

[JRCT]

The first couple of years that I contracted (and I'm only into my third), my take home was probably only about £5k more than my previous permie salary. However, I only worked 6 months of each year. My first break coincided with my wife going back to work after mat leave and I had 3-4 months at home with the baby.

THAT was priceless and something I could never have done in my permie role.

[kaiser78]

Let's say you are a jack of all trades .NET developer with nothing special about your skillset. Five years experiences and you are earning £35,000 with a take home pay of about £27,000. That is the average developer salary in the UK.

Now consider that in your area the market rate for such a contractor is about £300/day, maybe £350. Well,and working on the assumption that you will be working 7 months per year (which is a rule of thumb I have read), your take home pay would be about £35,000 per year. I know there are no certainties with this as taxation and contracting, along with rates and work, are uncertain, but let's try and have a discussion here.

That would have you £8,000 per year better off. That's not to be sniffed at, but it's not exactly a huge amount if you are in contracting primarily for the money.

Am I completely off the mark here or is this what contracting has to offer? I have only begun looking into it with real intent recently, but I am not sure it's worth the hassle for that kind of pay rise.

Average rule of thumb is hourly contracting rate *1200 = perm salary equiv. Some guys on here use *1000, although I think *1200 is more realistic.

Either way contract rate + lifestyle + lots of other factors far outweighs permie role any day of the week (mon - fri)

[TheFaQQer]

Think about what you could be doing with that other 5 months of the year not tied to a desk.

For many, panicking that they can't find any more work.

[TheFaQQer]

Average rule of thumb is hourly contracting rate *1200 = perm salary equiv. Some guys on here use *1000, although I think *1200 is more realistic.

Either way contract rate + lifestyle + lots of other factors far outweighs permie role any day of the week (mon - fri)

That's one way to look at it (or even two).

However, round here, the multiples just don't add up. My first (and lowest paid contract) was significantly higher than I could get locally in a perm role, whether using 1000 or 1200 as a multiple.