Contrary to popular belief, becoming an independent contractor wasn’t a progression of an established career. I was fortunate enough to have family members who had been self-employed in the SAP space so I knew that was a viable option for me to start my career.
I knew the pay and flexibility were much better as an independent contractor. In general, implementation projects require overtime hours, expertise, and a willingness to “get the job done” attitude. In comparison, salary jobs require you to work overtime hours without the compensation and flexibility that is allotted for a contractor. SAP projects are usually mutli-million dollar investments that generate billions in revenue so direct clients are willing to pay well in the industry for specialized technical experts.
Another compelling reason for choosing the career path of an independent contractor was the exposure to different industries and types of projects. I wanted to find gigs that would allow me to see various phases of a project.
However, the most compelling reason to be an independent contractor was the flexibility and time between projects. With the pay of being an independent contractor, it allowed me to take time between projects to further my interests. I would often take a month or two off between my projects to gallivant on a solo trip to Europe or Asia. I was no longer confined to the 11 days PTO and 10 days of sick leave. I was getting paid for my time, for better or for worse.
Now let us not glorify consulting. There are some cons that come with being self-employed. The first is the lack of security when you complete or end a project. You can go a few months without finding another project and the wait can be stressful and financially taxing. Second, you do have to update your resume constantly and market yourself. The best time to find another project is when you already have one. If you know that the project is coming to an end in 3 months and there is the barest of inclination that you will not be extended, it’s time to whip up your resume and start applying to positions.
Third, your rate can fluctuate. If you market yourself well and wait for the right job, you can increase your hourly rate for every project. However, it’s not guaranteed. Sometimes the rates reflect the current market, so plan and build your lifestyle accordingly. I always budget for 3-6 months of no work. That allows me to reduce the financial burden and stress of not having a job while searching for one.
Lastly, if you sign a 1099 contract, more than likely you will need to pay for your liability insurance. Some direct contracts or implementation partners require a proof of insurance policy. Account for this investment when making the decision to move away from full time work.
Contracting is not for everyone, so make sure you weigh the pros and cons to see if this works for you.
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