Forbes Magazine says that contractor employment seems to rise each year, but that by 2020, it’s going to make up approximately 50% of the labor force, and that’s a massive number. Working as a contractor enables you to make a great deal of money while working on your own terms and schedule. Many people prefer contracting to the standard nine-to-five because of the freedom that comes with it. While contracting your services is lucrative, there are essential elements that need to get taken into consideration before you accept a project from a client. Let’s take a look at some things you need to think over and ask.
Weighing the pros and cons of a potential job is critical regardless of if you’ve been working your entire life, or if you’re just returning to the workforce. It’s easy to accept any job offer just to get the bills paid, but striving for a position that does more than put money in your bank account is ideal.
Consider asking yourself if the job opportunity is going to boost your career as a contractor? Are you able to grow as a contractor with the company? Are you going to work directly with the clients or with a representative for the business? Are there tight deadlines with strict quotas?
It might not seem like it at first, especially if you’re just returning to work, but putting yourself in positions that offer growth, experience, and skill refinement could prove to be beneficial in the long run, which could bring you an increase in income.
What Benefits Are You Going to Receive?
One of the biggest downfalls of being a contractor is the lack of benefits. You might not know it, but there are instances where companies who hire contractors and freelancers do provide benefits as a way to hold on to and build beneficial and healthy relationships with those that they employ.
There’s nothing wrong with seeking out potential clients who have programs set in place specifically for contractors. Ensuring that you have health and dental insurance put in place could be an expensive thing; not to mention the added expense of contributing to retirement funds. Have you thought about holidays and stat pay? What about sick time? Is there room for emergencies and short-term leaves? How is your salary going to get affected?
You can use your experience in your area of specialty to leverage some benefits with your current or potential employer, though it’s important to be grateful if they can do something like that for you. Some benefits are far better than receiving none, and coming across as ungrateful could cause the progress to tumble down.
What, When, and How? Ask About Your Pay
When contracting, it’s likely that you are going to get paid different rates depending on the project you work on, and depending on the client. Your finances are incredibly important, and you should never accept less than you deserve. Always keep your fees reasonable. Ensure you ask how and when you get paid? Are you paid by milestone or by the completed project?
While contractors might receive paychecks, there’s a good chance that remote freelancers get paid through platforms such as PayPal. When you create an invoice for your client through these platforms, charges typically get charged. If you need to pay for the expenses, it’s a good idea to raise your rates just enough to cover the added fees or ask your client to cover them.
Additionally, you need to take care of things such as taxes for income as well as self-employment. This means that multiple forms need to get filled out, and you should put money aside to take care of these expenses. Consulting with an accountant is best.
Can You Renew the Contract?
Knowing whether or not your contract is renewable is very important to a contractor, and you should confirm multiple times before you begin working for the client. For example, working as a hired contractor for a non-profit organization could mean a longer time in between projects; this affects the position
There are plenty of positions available that have renewable contracts and are flexible, but it’s something you need to ask about as your project comes to a close. Many employers are going to want to keep working with the same contractors if they are satisfied with the work, however, if they feel like you aren’t interested, they might not approach with the topic of extending or renewing your agreement.
Getting stuck in a bad situation because you didn’t prepare adequately and now have to spend time scrambling for work could leave you tired and in a financially tight place. You could end up accepting projects that don’t pay what your skills should get paid for because you don’t have the time to look around for something else.
What are Your Working Hours?
There are a handful of ways that you can get paid when working as a contractor, so it’s a good idea to know what your working hours are, and to stick with them. Try taking a look at the commitments you’ve made for the week, and estimating how much time you are going to need to complete the project. There are contractor positions that are full-time jobs, while there are others that only require you to work during specific hours of your choosing (just as long as the project gets completed.)
Ensure that you talk to your employer and clients to find out if they expect you to be on-call and readily available to reply to emails and take on additional roles.
Working as a contractor has many benefits to it. Who doesn’t want freedom, flexibility, the ability to come and go as you please and sometimes even higher pay? Like most things, some pros and cons need to get weighed. You can curate a part-time contracting position into something lucrative and a full-time position; just ensure that the job is living up to your expectations. Additionally, remember to keep your clients and employers aware of your schedule and not get drain yourself out.