Contracting summary - long!

[Larry Weber <larry_weber -at- HOTMAIL -dot- COM>]

Thanks to everyone that responded. These are most of the responses that
came directly to me.

Larry

**************************************************
How do contractors enjoy their work? How does it compare with corporate
work?
**************************************************

I'll never go back to corporate life again.  I choose my projects and my
clients.  If I'm not happy, I don't push to  renew; if things get really
bad, I opt out (only had to do that once).  I have (almost) complete
control over what I do, when and how and where I do it.  If I want to
take a day off for a school field trip or because one of the kids is
sick, I don't have to justify the time off to anyone.  And if I work 60
hours one week, I get paid for 60 hours (not like all the unpaid
overtime I worked as an engineer).

*******

For me, there is no comparison. I have a terribly low threshold for
boredom, and in contracting, I am never bored. Always moving on to
something new, either for the same client or another one. Doesn't matter
to me, just as long as it is something new.

*******

I LOVE IT; I wouldn't do anything else!! I have never worked as an
employee writer, and hope to never have to.

**************************************************
>If you work at home, do you go bonkers with "cabin fever?"
**************************************************

Sometimes.  I make sure I schedule time for myself -- last fall I
started taking fiddle lessons one night a week, just so I could see
people other than my family!  Join your local chamber of commerce or
some other business networking group if you're concerned about talking
to yourself. (Personally, I find the intelligent answers refreshing!)

*******

Never. Plenty of other things to do, meetings to attend, groceries to
buy, weeds to pull - for me, working at home means that I can work my
own hours, go out to run errands when everyone else is at the office,
and generally enjoy myself a lot more than I did at work. Plus, I am
about twice as productive as in the office.

*******

I arrange to do lunch or dinner with friends. I take breaks where I go
shopping (groceries, etc.) or chat with neighbors who are out gardening,
which gets me into contact with lots of other human beings. (By the way,
I do prefer a lot of solitude and like working in a very quiet
environment.)

**************************************************
How do contractors manage health insurance?
**************************************************

I carried my own, first through COBRA and then on my own. The difference
in the amount of money you make more than makes up for it.

*******

In Canada, that's not as deep a concern as it is in the US.  I also have
the advantage of being able to ride on my husband's policies at work.

*******

Before I was married, I paid for my own health insurance (around $230
per month, if I recall correctly).  Now that I'm married, we pay for my
policy through my wife's employer.  It's much cheaper and it's better
coverage.

*******

With our checkbooks! Just find a good policy (and include, if you can,
long term disability and life insurance) and pay for it. I have the
money deducted from my business account each month, and that way I don't
have to remember to mail the check. And it hurts less that way, too,
because I don't see it!

*******

I belong to Kaiser, a big HMO, and pay my own insurance. I joined years
ago through my membership in a consumers co-op.

*******

With the new MSA (medical savings accounts) available, one only needs to
buy catastrophic coverage while paying for routine health care from the
tax-free MSA account.

**************************************************
After all is said and done, how's the money?
**************************************************

Good. Very good. My "normal" fee is $60/hr, and I know a lot of people
who charge more.

*******

The pay for contractors is generally 30% more than it is for employees,
so that's not too bad a'tall. :) But, I'd rather be an employee because
of the stability.

*******

I make far more an hour than I did as an engineer.  And what I charge is
mine.  I pay my own unemployment insurance and Canada Pension (like
Social Security), but the rest is money in the bank.  I charge between
$35 and $50 per hour, depending on the work and length of the contract.

I'm also responsible for maintaining and upgrading my hardware,
software, and training.  That takes more time and money than many
contractors initially allow for.

If you're considering freelancing, I'd highly recommend taking a course
or two on small business management, especially the tax implications
thereof. Set up your company correctly from the start, and you'll have
fewer problems come tax time.

*******

How they pay me is also a issue to think about. As a contractor, you
will most likely have to pay your own taxes. That means all your social
security (instead of half), and state and federal taxes, as well as
unemployment. This is something you have to factor in when you consider
a job or compute your rate. I would also recommend some pre-paid legal
assistance. Get a financial advisor and see what you can write off
towards taxes as being in business for yourself.

*******

I am making roughly 2.5 times the salary that my "corporate" friends are
making, all other things being roughly equal (education, years
experience, etc.) The money is great, at least for me it is. I have 18
years experience, btw.

*******

Very good. I really only work about half the year, leaving me lots of
time for gardening and other play. If you want more money, you work
more. Of course, there are times when jobs are short and you may go 6
months without work even though you really want to be working.

************************************************
Specifically, what skills are most important in the marketplace?
************************************************

Cross-platform facility with the best of Word and Frame, with good
graphics packages, with at least one programming language, with at least
one Help system, with HTML page construction and design, with file
management.

************************************************
Should the economy turn bad (as most cyclical things do), how do you
think you'll fare?
************************************************

I'll be fine.  I turn down far more work from agencies than I can
possibly accept (actually, I refer the agencies to my loca STC job
bank).  I have a good network of past clients who occasionally call for
me to do more work. I'm continually upgrading my skills and looking in
new directions.  And my bread-and-butter client has work lined up for me
for about 6 years!

*******

Terrifically.  I can always reduce my rates.  I don't have to stay a
technical writer, either - I'm also a systems analyst, network expert,
webmaster, etc., depending on what's needed.

************************************************
For those who started as an employee, how much experience did you have
before you made the leap?
************************************************

I never worked as a tech writing employee.  I went straight from
full-time engineering into freelance tech writing.

*******

Five years.

**************************************************
Miscellaneous
**************************************************

Some Advantages
1. I love the work, although it can get tedious at time.
2. The freedom is wonderful.  If I need to pick up my daughter from
school, or take the dog to the vet, or run into town to pick up some
groceries, or just take a few hours in the afternoon and work outside, I
can.  To me, this is the best part and I would not give it up.
3. I am often amazed at just how productive I can be working in a quiet
office.
4. I can work anywhere.  I just got back from a week at the beach.  Had
my portable and a Windows CE device.  Got lots done and had a chance to
relax.

Some Disadvantages
1. Cabin fever/lack of people contact can be a major issue.  There are
days when a client calls at 2:00 PM and I pick up the phone and have
trouble putting a sentence together because it's the first time I've
spoken all day!
2. Uneven cash flow sucks.  If your clients don't pay you on time, you
can't pay the mortgage on time unless you have a few months' income
socked away.  I always keep around $5k of emergency cash in liquid
savings.
3. I have been without work only two times in the past three and a half
years, once for 3 weeks, and once for 5 weeks.  It was a scary
experience and, surprisingly, took its toll on my self-esteem while I
had no work.
4. When you work out of the house, it's that much harder to get away
from the work.

*******

I found that a lot of contractor employers expected me to bring in my
equipment. I have a very nice home PC, and I'm not putting it in
anyone's office but my home office, so I got a laptop to do work where
the employer does not provide tools to do the work. I also charge them
more because they are paying for my equipment
as well as my skills.

Build a network of people who also contract - programmers, writers,
graphic design artists. They will refer jobs to you, and vice versa. I
have a good friend in the contract programming arena. He gives me a lot
of leads, or has asked favors (please do this project for me, I'll
subcontract it to you). What goes around eventually comes around.

Remember even as you are working on your current job, you need to think
about the next job. That is one of the reasons I am back at corporate. I
went through a reclusive phase where I didn't want to go hit the
streets, call the numbers, send the resumes (tired of a spate of short
projects and some clients postponing a project at the last minute). So
I'm back in corporate doing contract on the side. I like the creativity
it affords me to do various independent projects, and I like the
security of knowing my mortgage is covered.

Research before you jump in and you will get a head start on the
competition.


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