
Ask HN: Full time contractor vs. employee, how much more expensive? - auslegung
Anyone here have experience working as a full time contractor? In your experience, how much more expensive is it for you to be a contractor vs employee? Considering things like Insurance, self-employment taxes, etc etc.<p>I’m trying to figure out how much salary to ask for beyond what I normally would, do I can cover those extra expenses.
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davismwfl
This is hard to have a generic statement about. But in general you should
start around 1.5x-2x a standard salary.

The reality is people with minimal experience will have a harder time with
this than someone with 10 years. That’s because employers will consider the
two very different. Someone with 3 years of experience will not command the
higher multiple, so 1.2x isn’t uncommon. But people with 10 years can work on
a 2-5x multiple pretty easily (much more in some cases), especially if they
have a specialty skill.

Just don’t underestimate the costs and plan that you will need to pay people
to get advice. IMO I would say never accept less than 1.2x what the position
would pay in salary.

And don’t fall for people saying you get all these deductions now etc when
they are trying to negotiate you down. That’s generally someone trying to take
advantage of you.

I founded, ran and sold more then one consulting group and it can be super
lucrative but don’t underestimate the costs either. You have to market, travel
to find work at times etc. That all has to come out of your fees.

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jppope
Employee overhead is usually an additional 15%-20% of their salary (benefits,
perks, etc). So if you are looking at doing the work as a contractor just add
25% onto what you would ask for as an employee: $100K turns into $125K

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tboyd47
25% is a very low-ball number.

Self employment tax: 7.5%

Health insurance premium = 15%

PTO + other benefits (life insurance, 401k, equipment, etc.) = 15% or more

And there should be a premium on top of that for non-perm. The cost of
contract renewal negotiations every year is non-zero.

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JSeymourATL
a quick-and-dirty rule of thumb is you should add 50% to a W-2 wage to find
its comparable 1099 wage.> [https://fearlesssalarynegotiation.com/contractor-
vs-full-tim...](https://fearlesssalarynegotiation.com/contractor-vs-full-time-
employee-salary/)

