Reply to: Advise required - Pushing 40 and new to contracting

[SueEllen]

Take their word with a bit of caution. Friends may be tempted to paint a rosier picture and tell you what you want to hear and may not want to give you advice that appears negative or not what you want to hear.

To be fair WestHammer's friends may give appropriate advice but WestHammer may not hear them or be able to work out the market has changed since his/her friends' went contracting.

It's also worth talking to other friends who run small businesses in different markets particularly if they deal with clients without any intermediatories. As while lots of contracts come through agencies, some contractors deal with clients directly.

[northernladuk]

Ladies/Gents

Thanks a lot for taking the time out to share your thoughts.

Have reviewed most of your comments and it is clear that I have more thinking & researching to do. Will reach out to those of you who have offered additional help. In addition, I am also going to seek out a few contractor friends and get their inputs on planning, strategy etc.

Cheers

Take their word with a bit of caution. Friends may be tempted to paint a rosier picture and tell you what you want to hear and may not want to give you advice that appears negative or not what you want to hear.

[WestHammer]

Ladies/Gents

Thanks a lot for taking the time out to share your thoughts.

Have reviewed most of your comments and it is clear that I have more thinking & researching to do. Will reach out to those of you who have offered additional help. In addition, I am also going to seek out a few contractor friends and get their inputs on planning, strategy etc.

Cheers

[bobspud]

Ladies/Gents

I have always held a permie job but under financial duress at the moment. So was beginning to wonder whether contracting is a right option for me. Please note

• I want to contract only for a period of 6-12 months. Want to go back to permie world once short term objectives are met
• Have done IT for 20 years with academic and professional qual to back up - all blue chip firms
• Current in mid-senior level management at a top british telco

Can you please tell me

1. What is your general feel of the market? My skills are generalist in nature - Project/Programme management, Change management, Org transformation etc.
2. Will people run away if I ask for a daily rate of £500-£600 - is it realistic in London market?
3. Please assume a rate of £500. What will be my monthly take home pay assuming I optimize it - there are many websites and they are all contradictory? Also assume 40 hour weeks and 20 working days a month

Please don't see me as a competitor - why don't you try and dissuade me from joining the group?

Thanks

As the others have said:

1) You need cash behind you to have a chance.
2) Stay away from schemes to help you keep more money you will get screwed by HMRC in the end.
3) You will never return to perm work after the first months turnover drops in your lap.
4) If you have spent the last 10+ years in one organisation then you are as good as screwed from a contracting point of view.

As for rates. I know a really crap chap doing programme management and transformation that despite their abilities, was still on £1k a day...

What is contracting about really?

1) Rapid response ( can turn up tomorrow and leave the day after)
2) Has a skill that has been acquired in many different environments and knows how to apply that skill in the the right manner for the current client. (not as regularly happens: I did this at my last place lets do it again...)
3) Used to self driven change and strategic forethought.
4) Has one core skill plus very many surrounding skills that can be demonstrated to deliver value for a client.

What contracting is not:
A short term money machine

[cojak]

Obviously gone a bit quiet on the HMRC letter front. This all went cold when they started dropping through doors earlier in the year.

[northernladuk]

Pah - 85%??? Try VIVA Contracts and get 90%!

Pfff, small potatoes... These guys say 91%

IT Contractor Tax - Retain upto 91% from an IT Contract
www.Blah blah blah.c0.uk/ITContractors
100% Compliant. Calculate Today!

Won't bother posting who it actually is for obvious reasons

[eek]

Pah - 85%??? Try VIVA Contracts and get 90%!

Better pay are offering the same and 100% tax compliant.

Why not go for it it'll solve your immediate cash issues and give you something else to worry about (Hmrc, rogerings and bankruptcy)

[TheFaQQer]

All of this - and MUN hasn't even mentioned what could happen to you if HMRC think that you haven't given them their 'fair' share of the proceedings (see my 1st post re. 85% retained earnings).

Pah - 85%??? Try VIVA Contracts and get 90%!

[cojak]

If you are already under financial stress you are taking a massive gamble jumping into contracting.

It is simply not the silver bullet you seem to think it is. Yes, there are many very well off contractors but most of them have been doing this for many years and all are very good at what they do - not just the technical aspects but the long term planning and direction of their company. That effort and foresight is the key to being a successful contractor not whether you can crow bar your way into a your first contract.

I moved into contracting about two years ago lost my first one after the verbal offer had been made. The manager and I got on like a house on fire but someone his boss knew got in touch after doing similar work for a different bank. I did not get a look in.

My next contract messed up payments so I spent a couple of grand out of my reserves to keep myself going whilst it got sorted.

These things happen, they happen quite often. Do not plan on them just not happening to you.

Do you have a mortgage? A family who depend on your income? If so be very very careful about doing this it could explode in a horrific way and the agency,client etc will simply casetyou aside and keep on going as if nothing had happened.

All of this - and MUN hasn't even mentioned what could happen to you if HMRC think that you haven't given them their 'fair' share of the proceedings (see my 1st post re. 85% retained earnings).

[MyUserName]

If you are already under financial stress you are taking a massive gamble jumping into contracting.

It is simply not the silver bullet you seem to think it is. Yes, there are many very well off contractors but most of them have been doing this for many years and all are very good at what they do - not just the technical aspects but the long term planning and direction of their company. That effort and foresight is the key to being a successful contractor not whether you can crow bar your way into a your first contract.

I moved into contracting about two years ago lost my first one after the verbal offer had been made. The manager and I got on like a house on fire but someone his boss knew got in touch after doing similar work for a different bank. I did not get a look in.

My next contract messed up payments so I spent a couple of grand out of my reserves to keep myself going whilst it got sorted.

These things happen, they happen quite often. Do not plan on them just not happening to you.

Do you have a mortgage? A family who depend on your income? If so be very very careful about doing this it could explode in a horrific way and the agency,client etc will simply casetyou aside and keep on going as if nothing had happened.

[eek]

Bzzzzt.... OK, if you've been offered a contract that pays significantly more than the job you currently have, then you *might* consider taking it up on financial grounds. Otherwise, this is definitely not on my list of good reasons to consider contracting...

But make sure you can pass a credit check. Its remarkable how many people I have seen over the years disappear when a credit check is required. And most decent payers at the moment (banks, government outsourcers) will require you passing one.

[ContractorsSpouse]

Ladies/Gents

I have always held a permie job but under financial duress at the moment.

Bzzzzt.... OK, if you've been offered a contract that pays significantly more than the job you currently have, then you *might* consider taking it up on financial grounds. Otherwise, this is definitely not on my list of good reasons to consider contracting...

[DigitalUser]

To the OP,

If you are going to make the jump, then, as the other posters have stated, you need to be fully aware of what you're getting yourself into. It took me 3-4 months of reading up before I handed my notice in at my workplace last year and made the move over. For someone starting afresh, you definitely need a bit of luck (which I got) finding your first role. Contracting is not for everyone - sure, there are financial benefits, but I was also realistic with what I could charge and what the market was like. I also had extremely sympathetic employers who let me have a flexible notice period so I could leave (after the initial 8 week notice period) at short notice.

If you want some pointers let me know and I'll private message you - however, I think there's a substantial amount of reading up you need to do before you consider anything.

Sent from my Nexus 4 using Tapatalk 2

[northernladuk]

Oh, just to add, it could be a little more difficult getting another permie job after contracting as well. They will be wary of your reasons to go contracting and pack it in so quickly. They may think you are going to do it again so not give you the job. So on top of getting binned halfway through you have two pretty sure stints on the bench before and after this dream contract so I can't see how this is going to help your financial situation.

[kevpuk]

<snip>You will not get a gig as a generalist. Clients are looking for specialists in their field to fill resource gaps they cannot fill.<snip>

This