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Been a contractor for about a decade now. A few tips: You need at least 1.5x ideally 2x your normal rate to make it worth it. You need to always be selling, p

Been a contractor for about a decade now. A few tips: You need at least 1.5x ideally 2x your normal rate to make it worth it. You need to always be selling, probably should make sure you are consistently overbooked if you want to keep contracting sustainably. Otherwise if you focus on one client only and they go poof, you are back in line for a job. Be prepared to work many many more hours because of the above. Don’t forget to calculate ALL your costs. If you can get a monthly retainer for X number of hours for close to your target hourly rate, take it even if it’s a little low. As long as you are good you’ll (probably) never really need to spend X hours. Leaving you with extra billable hours to devote to other clients while still having some guaranteed income. This is one of the only ways to get ahead, aside from charging “book” hours (estimates) rather than actual elapsed hours. You’ll get stuck in whatever price range you start with so do not lowball yourself. Again, always be selling, and hours are precious, don’t waste them. It’s a stressful life because you start to have issues taking any time off.

WildGreenLeave 4y ago
The last sentence is really true. I went into contracting/freelancing about 3 years ago and whenever I take time off, I still feel "guilty" because I could be working and make X amount of money extra. I think it is good to have that insight tho, but if you start to remove your personal life because of this, I think you should really need to reconsider your strategy. (Looking at TS)
- __pache__ 4y ago
  How do you guys cope with this? I feel so guilty taking any time off, even to play with my kiddos/dogs/whatever. "Could be making $200+/hr right now" is always in the back of my head.
  - WildGreenLeave 4y ago
    Well.. first of all sadly enough I do not earn $200+/hr. I am in Europe and there rates are around $100/hr. (Either that, or I should turn this post into a looking for work!) That being said, it doesn't change the feeling. I try to make myself feel better by thinking something along the lines of this: I have no money issues, more money would ofcourse make life a little bit better. But what if I were to die tomorrow? I would much ratter spend quality time on the life of the people (or animals) I care about, or my own life, then have a few hundred bucks extra. That, together with knowing that I cannot always work because I will burn out and will earn nothing anymore goes a long way. I work to live my life, I do not live my life to work :)
    - __pache__ 4y ago
      > But what if I were to die tomorrow? this is probably the core thought. what would I pay to get "one more day with my sons?" millions? if I had no more days left and could give it all... > I work to live my life, I do not live my life to work :) my work is extremely important to a lot of people, I can make jobs for others, etc. .. my work _is_ my life, and that's way better for lots of people. hard to reconcile/balance, for sure....
      - WildGreenLeave 4y ago
        > my work is extremely important to a lot of people, I can make jobs for others, etc. .. my work _is_ my life, and that's way better for lots of people. hard to reconcile/balance, for sure.... I enjoy my work, I love getting stuff done and helping people. But, at the end of the day, I can only do this because I am getting paid. So I do not do my job half assed because it is only my job, I will try to take the extra step where possible. But I have to do it in a way that I can keep on doing it. Life is a marathon, not a sprint
        __pache__ 4y ago
        > Life is a marathon, not a sprint for sure, thanks for sharing your perspective
disenchanted_ds 4y ago
That's a great idea around retainers. I hadn't really been considering that as an option. I've been thinking about even trying to approach this from a value-based pricing perspective a la Jacques Mattheij. Seems like that could be an easier approach to selling, in terms of positioning myself as an expert instead of just a coder-for-hire.
iasay 4y ago
This pretty much nails it. Also nails why I folded my company and I’m a corporate wage slave now. I’d rather all this shit was someone else’s problem to deal with.
nightski 4y ago
You can get lucky like myself and have a small handful of clients for over a decade. Honestly don't think I'd do consulting otherwise. I'd say the key was finding a stable industry that has been around for a long time, but at the same time is more dysfunctional when it comes to tech. So much opportunity to help them out. Often internal IT is underfunded and so focused on just keeping things running that there is a lot of room for one to differentiate themselves.
anotheracctfo 4y ago
A self-employed accountant once told me that you take your hourly wage and triple it. 1/3 is your salary, 1/3 is for business expenses and taxes, 1/3 is for when you don't have work. The lucrative part is when you get more than 1 FTE of work and start hiring employees. Which was my experience working for a small consulting firm. I made decent money with my 1/3 salary, but my bosses made $$$$ because we priced for 1/3 downtime but were constantly flush with work. Good luck!
- nickjj 4y ago
  > 1/3 is your salary, 1/3 is for business expenses and taxes, 1/3 is for when you don't have work. In the US there's also health insurance if you choose to have it. The worst of the worst medical insurance just for you is going to run you about $500 / month. Even if you "only" make 60k / year, that's still roughly ~10% of your income which is a lot.
  - nightski 4y ago
    If you are lucky enough to have a spouse that works at a good company it can be very lucrative to take the self employed route and freeload off their plan :)
  - biztos 4y ago
    And in many other countries too, without the “choose” part. I pay more than that for my private health insurance in Germany… it’s a pretty good one but has a high deductible so I’ve never actually used it in over a decade.
- bhandziuk 4y ago
  And this is the reality of consulting too. You might get paid X but you are billed out at 2-3X.

WildGreenLeave 4y ago

The last sentence is really true. I went into contracting/freelancing about 3 years ago and whenever I take time off, I still feel "guilty" because I could be working and make X amount of money extra. I think it is good to have that insight tho, but if you start to remove your personal life because of this, I think you should really need to reconsider your strategy. (Looking at TS)

__pache__ 4y ago
How do you guys cope with this? I feel so guilty taking any time off, even to play with my kiddos/dogs/whatever. "Could be making $200+/hr right now" is always in the back of my head.
- WildGreenLeave 4y ago
  Well.. first of all sadly enough I do not earn $200+/hr. I am in Europe and there rates are around $100/hr. (Either that, or I should turn this post into a looking for work!) That being said, it doesn't change the feeling. I try to make myself feel better by thinking something along the lines of this: I have no money issues, more money would ofcourse make life a little bit better. But what if I were to die tomorrow? I would much ratter spend quality time on the life of the people (or animals) I care about, or my own life, then have a few hundred bucks extra. That, together with knowing that I cannot always work because I will burn out and will earn nothing anymore goes a long way. I work to live my life, I do not live my life to work :)
  - __pache__ 4y ago
    > But what if I were to die tomorrow? this is probably the core thought. what would I pay to get "one more day with my sons?" millions? if I had no more days left and could give it all... > I work to live my life, I do not live my life to work :) my work is extremely important to a lot of people, I can make jobs for others, etc. .. my work _is_ my life, and that's way better for lots of people. hard to reconcile/balance, for sure....
    - WildGreenLeave 4y ago
      > my work is extremely important to a lot of people, I can make jobs for others, etc. .. my work _is_ my life, and that's way better for lots of people. hard to reconcile/balance, for sure.... I enjoy my work, I love getting stuff done and helping people. But, at the end of the day, I can only do this because I am getting paid. So I do not do my job half assed because it is only my job, I will try to take the extra step where possible. But I have to do it in a way that I can keep on doing it. Life is a marathon, not a sprint
      - __pache__ 4y ago
        > Life is a marathon, not a sprint for sure, thanks for sharing your perspective

disenchanted_ds 4y ago

That's a great idea around retainers. I hadn't really been considering that as an option. I've been thinking about even trying to approach this from a value-based pricing perspective a la Jacques Mattheij. Seems like that could be an easier approach to selling, in terms of positioning myself as an expert instead of just a coder-for-hire.

iasay 4y ago

This pretty much nails it. Also nails why I folded my company and I’m a corporate wage slave now. I’d rather all this shit was someone else’s problem to deal with.

nightski 4y ago

You can get lucky like myself and have a small handful of clients for over a decade. Honestly don't think I'd do consulting otherwise. I'd say the key was finding a stable industry that has been around for a long time, but at the same time is more dysfunctional when it comes to tech. So much opportunity to help them out. Often internal IT is underfunded and so focused on just keeping things running that there is a lot of room for one to differentiate themselves.

anotheracctfo 4y ago

A self-employed accountant once told me that you take your hourly wage and triple it. 1/3 is your salary, 1/3 is for business expenses and taxes, 1/3 is for when you don't have work. The lucrative part is when you get more than 1 FTE of work and start hiring employees. Which was my experience working for a small consulting firm. I made decent money with my 1/3 salary, but my bosses made $$$$ because we priced for 1/3 downtime but were constantly flush with work. Good luck!

nickjj 4y ago
> 1/3 is your salary, 1/3 is for business expenses and taxes, 1/3 is for when you don't have work. In the US there's also health insurance if you choose to have it. The worst of the worst medical insurance just for you is going to run you about $500 / month. Even if you "only" make 60k / year, that's still roughly ~10% of your income which is a lot.
- nightski 4y ago
  If you are lucky enough to have a spouse that works at a good company it can be very lucrative to take the self employed route and freeload off their plan :)
- biztos 4y ago
  And in many other countries too, without the “choose” part. I pay more than that for my private health insurance in Germany… it’s a pretty good one but has a high deductible so I’ve never actually used it in over a decade.
bhandziuk 4y ago
And this is the reality of consulting too. You might get paid X but you are billed out at 2-3X.