Flippity-Flop: Weighing up a Return to Contracting

[ChimpMaster]

Surely depends how much you love/hate your job.

I'm (now) a permie on nearly 90k + bens but I don't enjoy the work. But the job is too comfortable to give up for now - I mostly know what I'm doing and it's almost 100% WFH. Ironically I was offered a promotion but didn't take it because personally I don't need/want to move in that direction.... and the extra £ after tax was minimal.

I'd go for a £500/day outside contract if I was given the chance and if it had reasonable likelihood of extensions. Everyone has their own reasons & breaking point. The money isn't the be all and end all.

[LondonManc]

Having contracted for about 9 years and now been back permie for 5, I can say that the pay vs day rate debate is completely irrelevant as long as you believe the day rates and salary are market rate or thereabouts.

What you need to think about is how risk averse you are, where you live and what the contract market is like near you. My thinking behind this is based on:
1/ Being in a £600/day rate is great while you're on it. But what's the chance of that being turned into 200-220 billable days every year?
2/ How many local contracts can you get on your happy rate and, if it's not enough, are you prepared to sacrifice your social life and daily routine to be living away a couple of days a week every week, etc.?
3/ Are you the sort who used to regret taking time off and being sat on a beach worrying you're not billing or are you out in the surf enjoying yourself?

Think of contracting as a lifestyle and whether it's for you or not. Day rates will by and large always be better than perm unless you climb the ladder instead. In ten years, you'll still be on a similar day rate, but could have climbed two or three pay grades in a permie role - again, something else to consider longer term.

Just another slant on the whole thing rather than the boring "what rate I need to be on to run a Maserati" question.

[PerfectStorm]

Every rate doesn't have to be a positive increment on the last one, but it should at least trend upwards over time. Better 80% than 0%.

[northernladuk]

Every rate doesn't have to be a positive increment on the last one, but it should at least trend upwards over time. Better 80% than 0%.

This. Waiting a few extra weeks for a better rate is unlikely to be more profitable over the short term.

[hugebrain]

Based on what?
How is your company set up?
How much do you put into a pension?

Are you LPM1?

If you mean why 3x in Switzerland, it’s because you can live the high life on their unemployment between contracts.

If you mean why double the hourly rate it’s because 50x5x8 gives you 2000. The tax and other advantages bump the contract rate up a bit so you can take more than 2 weeks holiday and still match the permie lifestyle.

Obviously it is just a rule of thumb, if the permie job includes a company car and a 100% bonus then you have to adjust it a bit.

[WTFH]

50x5x8 gives you...

...a sad lonely existence where your only friend is your accountant.

[TheDogsNads]

Thank you for inputs - I appreciate the differences (I enjoyed the good, bad and ugly in my relatively short (5 yrs) spell as a contractor) - in, out and FTC.

This post was more about settling an argument with my wife - I recall from the beforetimes of IR35 there was a loose formula (day rate multiplied by X) which gave a rough approximation of what was an equivalent take home, taking into account void periods, holiday etc., albeit a very rough guide.

My original intention had been to use this formula to beat my wife over the head and show that really my current pay means I'd be silly to revert to contracting.

However, as is often the case, I've started to come around to her way of thinking. Back of a fag packet maths:

- £90k salary, rough take home £4.8k + £1.1k pension = £5.9k net.
- An inside purportedly long-term contract - £750/day - £8.1k, assuming 8 weeks off, - £800 month commuting expenses = £7.3k net.

Playing Devil's Advocate, am I not significantly better off financially with the inside gig, and have added flexibility around how much I wish to take home/pay into pension, and how much holiday I wish to take.

Im struck by are you a man or a mouse? Your wife wants you to go back contracting to earn more money so she has more to spend? Or she wants you living away from home in the arse end of nowhere while she has her bit on the side round?

Either you want to go contracting or you dont. All this 'wife wants' stuff is just a smokescreen.

Jib your permie job off and see how much better off you are in 12 months time even with an IR35 inside job then compare!

[fiisch]

I know as a third party, I'd read this thread and scream at the OP to stay in his cushty permie job, but truth be told I'm bored and frustrated. My current role is in a slightly different area of my industry that I find less interesting, and I'm bored, and I'm ****ed off. I've also been promoted this morning, but no payrise attaching to this, which is an added boot in the teeth. So screw this, I suspect I'll be a contractor again in the not-so-distant future...

Two interviews lined up this week - one Inside, one Outside, both exciting projects. I daren't ask how I go about comparing Inside vs Outside rates......

[Paralytic]

I know as a third party, I'd read this thread and scream at the OP to stay in his cushty permie job, but truth be told I'm bored and frustrated. My current role is in a slightly different area of my industry that I find less interesting, and I'm bored, and I'm ****ed off. I've also been promoted this morning, but no payrise attaching to this, which is an added boot in the teeth. So screw this, I suspect I'll be a contractor again in the not-so-distant future...

Promoted but no pay rise? I'm sorry, but that's not a promotion - that's a p!ss take. I assume more responsibility? Did you try to decline the promotion?

Time to quiet quit i think...

[rocktronAMP]

I know as a third party, I'd read this thread and scream at the OP to stay in his cushty permie job, but truth be told I'm bored and frustrated. My current role is in a slightly different area of my industry that I find less interesting, and I'm bored, and I'm ****ed off. I've also been promoted this morning, but no payrise attaching to this, which is an added boot in the teeth. So screw this, I suspect I'll be a contractor again in the not-so-distant future...

Two interviews lined up this week - one Inside, one Outside, both exciting projects. I daren't ask how I go about comparing Inside vs Outside rates......

You and I will always have The Law of Two Feet. I'd be off with a new job title promotion of £0.00; that s**te and not suitainable for your personal performance and your mental health.