Keep itching to get into Contracting

[malvolio]

I'd dispute the figures being bandied around here - I left a £78k job (admittedly with some pretty good perks like non contributory pension making it a job worth ~£100k with no bens


moved onto £500/520 p/d contract and according to my figures after a year of contracting (exactly matching the financial year which has been handy for accounting...) and I reckon I've made £107k net this year - which equates to £183k using a reverse calculator.
(assumptions are that I've "made" the money in my war chest but haven't drawn it yet)

Now that includes having one of the best set ups where my wife has half the shares and I did have quite a large amount of expenses travelling into London daily from Z6 but still - thats not too different to the figures the OP was quoting and is a substantial increase.

Just my 2 pence worth from the other side of the fence.....

But as several have alluded to thats a full year billing 224.5 days (gotta love a detailed invoice tracker spreadsheet)...... so depends how in demand your skill set is.

I assume your net includes basics like ErNICs and PI/PLI, but have you accounted for paid holidays (your full permie working years is 48 weeks a year or less for free), training, sick pay cover and health care cover...

These things are never linear, which is why making comparisons is so very difficult. It's also why I say you should never for contracting for the money: it's very nice to have the strong income of course, but that's a side effect of taking risk and foregoing a lot of security.

[TechJinx]

I assume your net includes basics like ErNICs and PI/PLI, but have you accounted for paid holidays (your full permie working years is 48 weeks a year or less for free), training, sick pay cover and health care cover...

Yes - my holiday was a week - didn't bill, so its included. Also a couple of days out sick I think - don't really get ill much.

I'm also in a position where my role is non technical so I don't need to keep up on training - role experience is more the key - so multiple roles helps.

health cover I had to pay for anyway out of my "benefit pot" and got stiffed in my tax code for benefits in kind so I'm happier paying not much more for my own choice of cover which is higher quality.

I don't know what ErNICs & PI/PLIs are so either its a yes or my accountant is useless......

These things are never linear, which is why making comparisons is so very difficult. It's also why I say you should never for contracting for the money: it's very nice to have the strong income of course, but that's a side effect of taking risk and foregoing a lot of security.

I'd disagree - the money is the main reason - I hopped around just as often between permie jobs - fun and games of project management. Now I'm expecting to do it - and getting paid more.

the aim is to get a warchest that can work for itself - buy some local buy to lets, or start some random business that washes its face - get the wife doing them up with me or working in the business and only ever going into London for West End shows and naughty weekends with or without the wife...

[malvolio]

...

I don't know what ErNICs & PI/PLIs are so either its a yes or my accountant is useless......

No, you are. Sorry, but if you don't know that, how on earth are you running a company properly and ensuring everything is properly covered off, even if you aren't actually liable for them...? YourCo's income and expenditure is your responsibility, nobody else's.

I'd disagree - the money is the main reason - I hopped around just as often between permie jobs - fun and games of project management. Now I'm expecting to do it - and getting paid more.

the aim is to get a warchest that can work for itself - buy some local buy to lets, or start some random business that washes its face - get the wife doing them up with me or working in the business and only ever going into London for West End shows and naughty weekends with or without the wife...

And I disagree with you. If I went permie in my current role I'd be around £15-20k a year better off and get paid for my free time. OK, I don't really need the money any more - ten years ago I wouldn't have said that of course... - but it's worth it not to have to cope with human Remains and all the other permie nonsense.

[PerfectStorm]

Mal is being obtuse.

ErNIC = Employers National Insurance Contributions

PI/PLI = Professional Indemnity & Public Liability insurances

AKA the things that get taken into account as expenses on your P&L.

And just looked at my billed days for the last year - 230 odd - which includes several weeks off plus forced leave.

Wouldn't go back to permidom for double what I was on - it'd still be a dead loss.

[TykeMerc]

The biggest financial benefit you have realised TechJinx is your wife having 50% of the shares and equal dividends, assuming she wasn't earning much before that's a significant jump in family income.

If money is your main motivation then you will find it nasty in a less favourable market (the last 2 years have been improving a lot over the previous 5+). Most of us with multiple years as contractors think 200 billable days is a decent year and a good average to aim for.

[Willapp]

And I disagree with you. If I went permie in my current role I'd be around £15-20k a year better off and get paid for my free time. OK, I don't really need the money any more - ten years ago I wouldn't have said that of course... - but it's worth it not to have to cope with human Remains and all the other permie nonsense.

I don't understand why anyone would go contracting if it weren't for the money? Surely the risk and added stress is only really mitigated by knowing that you're benefiting financially?

Speaking for myself, the first time I went contracting I left a £40k perm role where I was netting about £2.5k per month to a £275pd contract where, as best I can remember I was netting between £4-5k per month so it was almost double.

This time round I left a £50k perm role and managed to land a better contract at £449 (C# MVC role outside of London) and again the net is going to be around double my previous salary.

Yes I know there are "other factors" and maybe I've been lucky not to have been benched before, but even accounting for time off sick, holidays etc. I can only see contracting as a huge financial gain. Where I live the ceiling for my skillset would be around £70k as a perm and I'm currently earning a lot more than that, without the management responsibility/stress that would come with a senior perm position.

[MattZani]

Speaking for myself, the first time I went contracting I left a £40k perm role

...

This time round I left a £50k perm role and managed to land a better contract at £449 (C# MVC role outside of London) and again the net is going to be around double my previous salary.

Just out of curiousity, why did you go back to a permie job when you were contracting for better money?

[theroyale]

Go for it

Thing is my permanent job in IT is not very exciting. I've been in the job 10 years now and tired of it. The temptations to ditch my job are regular but l have a feeling I'd regret it given how "comfortable" the role is.

There are a few reason to ditch,

1. More variety
2. Experience life (90% of my work is home based with occasional travel to customer sites). Only advantage working from home is the 2.5 hrs l save not travelling, otherwise it's kinda boring as l like banter
3. More money (upto £450 should be attainable)
4. Nothing to lose but potentially a lot to gain - GF with no kids planned, debt free, war chest would last me years if l end up on the bench
5. New challenge

The reason not to ditch my job,
1. Salary (>£70K)
2. Usual perks such as good pension, life insurance, medical cover, car allowance, project bonus
3. Really easy projects (time consuming but nothing is rocket science)
4. Professional team members (no tools or wasters)
5. Plenty of work (can't recall idle time in-between projects)
6. At an age where it might not be best to jump. Keep thinking this is something l should have done in my 20's

Really I've got it good right now but it's as interesting as staring at a washing machine.

I do count myself lucky to be in this position at 40 years old.

Right now my skills are leading teams, writing design documents and getting my hands dirty on C++/JavaScript/HTML/.NET. I could easily works as a BA or get my hands dirty on development with the latter offering good daily rates.

Has anyone been in my position?

What would you do?

I do read about the contracting market not being so hot but l work with contractors a plenty.

Interesting responses so far.

I went into contracting 5 years ago (after 5-6 years as perm, so a bit younger than the OP who's 40) and have hugely enjoyed the experience.

The money is the main reason you go into it of course. Flexibility is another. But there are other reasons that one might put in the "soft skills" bucket:

I have become a more confident person in life generally (because of the way you sell yourself and hit the ground running in the contracting world). I have become more deadline- and goal-oriented (for e.g. I have hit my fitness goals a whole lot better after becoming a contractor).

I have become more interested in the wider technology world. I am no longer stuck in one job waiting to be told (or to discuss with my manager at next appraisal meeting) what to do in the next six months/one year. I can actually -- within reason and the boundaries of opportunity on jobserve -- find new and more exciting things to do.

The one thing I have by-and-large escaped (living in London zone 2) is having to travel too much. I would hate commuting long distances/staying in B&Bs during the week etc. So if you don't live in or near a hotspot, take note.

To the OP: do your maths, and then go for it.

[Willapp]

I was looking to move house at the time and, having only been contracting for 15 months, felt I would struggle to get a mortgage. The company I contracted for were keen to keep me so they offered a decent perm salary (granted less than I was getting as a contractor, but still better than my previous perm role) so I made the switch back.

Have now moved house and I probably would have still been in the same perm role but, surprise surprise, they got bought out by a larger company and I could just see the job turning to **** so I jumped quickly and was lucky to land a great contract and just before xmas too.

I would always consider going perm again if the circumstances were right, but I would do it knowing that I'm exchanging a big chunk of cash for the security or opportunity that a perm position might offer.

[malvolio]

Mal is being obtuse..

Who - me!?


OK, I was - but it kinda comes back to my point about your job is being a contractor, not a PM or a coder or an architect, and you need to understand as much of it as you can. Including all the arcane details that don't bother permies.