What are your thoughts on being a contractor vs salaried consultant? I just received an offer to leave my current firm for a 20% raise to be on a short contract with likelihood of extension/conversion to FTE. Besides them potentially cutting any hope for extension, can anyone provide advice on what to be careful about? Thanks a lot!

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Look up your self-employment tax rate if they are doing 10-99. It will be more than the +20%. Hopefully it’s a W2 contract rate. Also, in this uncertain time, I wouldn’t put too much weight into the FTE conversion.

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Definitely would not recommend. Or ask what their conversion rate to FTE (I bet they won’t share cause the answer is close to 0). I’m biased but my company only hires contractors when we know we don’t want/need a FTE any time soon. Otherwise we’d just hire someone. Have seen contractors with strong skill sets get strung along thinking there is a job waiting at the end when there just isn’t

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You’re 1099 rates need to be at least double your salary due to taxes and healthcare

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The answer is no.

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i've consulted for 25+ years. the salary and flexibility is highly desirable. paid OT is fantastic. but not all agencies offer benefits, or 401Ks, or any guarantee. contracts are "at will" and can end at any moment for any reason. if you can stomach the risk of uncertainty, have money in the bank to live on in case it ends abruptly, and having to be in the job market every 3-6-9-12 months, then give it a shot. a boost in income is desirable but if the client runs into budget issues, contractors can be let go with no notice. determine if the boost is enough to take the risk, which could end up costing you if you have to be unemployed more frequently

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Lol

Depends on your rate and whether your contract is set up as a 1099 or corp to corp.

Assuming you can do the latter at a high hourly rate, contracting is far better and it isn’t even close.

Check all-in out of pocket costs. Health insurance, retirement etc may be worth more than the extra 20% comp.

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