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School Me on Consulting

Old 01-10-2017, 11:47 AM
  #21  
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I did it for several years. There's certainly pros and cons. Everyone else seems to be addressing the business side of things so I'll mention something I don't see ... costs. Remember that your taxes are going to be much higher. You have to pay not only the employee side of income tax, but the employer side as well. Regardless of if you are doing this on the side or as your primary business, consult a tax accountant or attorney to make sure you don't dig yourself a hole.

Also insurance. Many areas have a small business association. Seek that out to see if they have a group insurance policy that you can get in on as any group policy is certainly going to be cheaper than an individual policy. Again, if it's consulting in addition to your primary work, that won't be a concern. But if consulting is going to be your primary, make sure you address insurance costs.

One last thing, if this is in addition to your primary work, make sure your company doesn't have any policies against moonlighting or non-compete should your consulting be in a similar field.
Old 01-10-2017, 02:54 PM
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Originally Posted by Recovery Room View Post
I did it for several years. There's certainly pros and cons. Everyone else seems to be addressing the business side of things so I'll mention something I don't see ... costs. Remember that your taxes are going to be much higher. You have to pay not only the employee side of income tax, but the employer side as well. Regardless of if you are doing this on the side or as your primary business, consult a tax accountant or attorney to make sure you don't dig yourself a hole.

Also insurance. Many areas have a small business association. Seek that out to see if they have a group insurance policy that you can get in on as any group policy is certainly going to be cheaper than an individual policy. Again, if it's consulting in addition to your primary work, that won't be a concern. But if consulting is going to be your primary, make sure you address insurance costs.

One last thing, if this is in addition to your primary work, make sure your company doesn't have any policies against moonlighting or non-compete should your consulting be in a similar field.

Wrong on taxes. If you are serious at all you will set up a LLC or S-Corp in advance (cheap and easy) and your tax burden will be dramatically less than a full time employee grossing the same amount. 1099 self employed or sole proprietorship is for people who don't take a half hour to educate themselves. They in turn get screwed by the IRS.

The other factor is risk exposure. If you screw up as a 1099 self employed contractor and are sued they can go after personal assets (house, cars, etc) for damages. With llc or s-corp you have much better protection (level varies by state - in my case personal assets are untouchable).

Insurance- a $1M General Liability will run $200-500 per year. If you need an Errors and Omissions rider ( not sure you would for web/database type programming unless it's very specialized work) budget $1-2k extra per annum.

If you are at all serious do a bit of legwork up front and get a company set up. Though I'll second that you're having trouble getting motivated to spread the word I'm not sure consulting is right for you. It's a 100% self motivated field and good things only come to those that hustle.
Old 01-10-2017, 04:03 PM
  #23  
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A little levity..
Consultants are experts, yes?
So what is an expert?
Let's break it down:

X in algebra is an unknown
Spurt is a drip under pressure
Thus
An Expert is an unknown drip under pressure.

Back to taxes............
Old 01-10-2017, 05:10 PM
  #24  
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Pm me is you need someone with UNIX, Informatica, or Oracle development experience. 30 years IT experience. Planning, coordinating, and estimating are also a few of my strengths.
Old 01-10-2017, 06:06 PM
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See, networking is everything.
Old 01-10-2017, 08:17 PM
  #26  
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I have basically nothing to add besides with what the others have said. It's all about who you know and you can never clock out. You'll never know who you'll meet at the airport or church etc. You really need to focus on who you know that is not in your typical business element, that way if they say hey we need a xxx guy you can fit the bill under general requirements
Old 01-11-2017, 06:48 AM
  #27  
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Originally Posted by Time Machine View Post
...And I would say that if you have been working in your field for 10 years, and dont have someone that will hire you, you may not have the right skills.

... Your good name is really all that you have, and you do not want to damage it.
Good thoughts for sure.
Old 01-11-2017, 06:58 AM
  #28  
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Originally Posted by Recovery Room View Post
I did it for several years. There's certainly pros and cons. Everyone else seems to be addressing the business side of things so I'll mention something I don't see ... costs. Remember that your taxes are going to be much higher. You have to pay not only the employee side of income tax, but the employer side as well. Regardless of if you are doing this on the side or as your primary business, consult a tax accountant or attorney to make sure you don't dig yourself a hole.

Also insurance. Many areas have a small business association. Seek that out to see if they have a group insurance policy that you can get in on as any group policy is certainly going to be cheaper than an individual policy. Again, if it's consulting in addition to your primary work, that won't be a concern. But if consulting is going to be your primary, make sure you address insurance costs.

One last thing, if this is in addition to your primary work, make sure your company doesn't have any policies against moonlighting or non-compete should your consulting be in a similar field.
The only people who pay a lot of taxes when self employed are Boy Scouts or folks without good accountants. I did it for years. Its really easy to show a loss. Yeah I paid some taxes but way less than I do when working for someone else.

With that said I now work for someone else because I want to focus on my work, not chase the next dollar and wonder when/where it will be.
Old 01-11-2017, 09:12 AM
  #29  
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In terms of motivation I suppose I should be more specific. I'm not unmotivated to follow the really good suggestions here. I would rather just do anything else but cold calling, which is really what kept me from trying this for so long. It seems, though, that most of you on here with experience in this area are almost 100% network based. This, I think I'll be happy to do.

Also, to answer a few questions, I am planning on doing this on the side. I have a great job that provides me a good income as well as a ton of education in my field. They do not prevent moonlighting so long as you do not create a conflict of interest.
Old 01-11-2017, 09:21 AM
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Originally Posted by andycfi View Post
In terms of motivation I suppose I should be more specific. I'm not unmotivated to follow the really good suggestions here. I would rather just do anything else but cold calling, which is really what kept me from trying this for so long. It seems, though, that most of you on here with experience in this area are almost 100% network based. This, I think I'll be happy to do.

Also, to answer a few questions, I am planning on doing this on the side. I have a great job that provides me a good income as well as a ton of education in my field. They do not prevent moonlighting so long as you do not create a conflict of interest.
Keep youir nose clean on this front.
I require rights of first refusal on any business ventures any of my staff enter into in any business area.
That's how the conflicts are avoided.
Old 01-11-2017, 10:24 AM
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Originally Posted by chrispnet View Post
Keep youir nose clean on this front.
I require rights of first refusal on any business ventures any of my staff enter into in any business area.
That's how the conflicts are avoided.
Definitely will. Fortunately for me, I don't work for an IT company (I just do IT for company) and most all of my side projects are in a completely different sector than my employer. We have policies on such things, which is nice because the line is pretty clear. I'm way on my side of it.
Old 01-11-2017, 10:39 AM
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Originally Posted by chrispnet View Post
Keep youir nose clean on this front.
I require rights of first refusal on any business ventures any of my staff enter into in any business area.
That's how the conflicts are avoided.
So you expect employees to turn over any work to you that you want after going and securing a contract?

As long as you don't steal proprietary knowledge or clients, potential clients, employees, etc, case law supports the employee on these matters in FL. Of course as a right to work state, the employer can also fire you for almost any reason at any time, so you're not 100% in the clear.
Old 01-11-2017, 10:43 AM
  #33  
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Originally Posted by chrispnet View Post
Keep youir nose clean on this front.
I require rights of first refusal on any business ventures any of my staff enter into in any business area.
That's how the conflicts are avoided.
I'd never sign that agreement.
Old 01-11-2017, 11:01 AM
  #34  
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If you already have a full time job you may find it hard to get contracts that don't require you to be on-site. Most employers paying consultant wages want you co-located.
Old 01-11-2017, 12:06 PM
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Originally Posted by Boat Bum View Post
If you already have a full time job you may find it hard to get contracts that don't require you to be on-site. Most employers paying consultant wages want you co-located.
That will certainly be a limiting factor. However, I've had luck working with companies that are willing to work around that. Sometimes if you are the right skillset for a particular problem, logistics are less of a limiting factor. I have a pretty good mix of business and IT, which has been the skillset that's helped me at work and on the side. A lot of times IT people hyper-focus on the technical. Sometimes the solution is not highly technological and sometimes it's an entirely different solution than the customer asked for (but it is what they really need). Most of these guys have selected me because I suggested something outside the box. Speaking of all of this, it is great material for the aforementioned case study portfolio. Thanks again for that suggestion!

I'd like to target small to medium size firms for this reason. Also because this customer profile seems to have the most problems that need to be solved. I do a lot of re-engineering of home grown solutions (excel, access databases, paper workflows, etc). Most of my previous side customers have been very happy with my work despite my limited availability. Funny enough, most of those jobs fell in my lap from having a conversation at a bar, restaurant, hotel, places I've been a patron, etc. I suppose that says a lot for the networking that's been suggested!
Old 01-11-2017, 12:56 PM
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Originally Posted by crazybeard View Post
I'd never sign that agreement.
So what?
Old 01-11-2017, 01:00 PM
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Originally Posted by jj1987 View Post
So you expect employees to turn over any work to you that you want after going and securing a contract?

As long as you don't steal proprietary knowledge or clients, potential clients, employees, etc, case law supports the employee on these matters in FL. Of course as a right to work state, the employer can also fire you for almost any reason at any time, so you're not 100% in the clear.
You don't have a clue what Right to Work means...obviously.
As far as case law support in Florida, I'm sure your expertise in labor law is awesome, considering you don't even understand what a right to work law is, so forgive me if I don't find you the voice of authority.

As a condition of employment in my firm, I have first rights of refusal to any work you wish to independently pursue.

To the extent that you pursue it without notification, my damages are the full extent of the revenue you generate in breach.
Old 01-11-2017, 01:06 PM
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Originally Posted by chrispnet View Post
You don't have a clue what Right to Work means...obviously.
As far as case law support in Florida, I'm sure your expertise in labor law is awesome, considering you don't even understand what a right to work law is, so forgive me if I don't find you the voice of authority.

As a condition of employment in my firm, I have first rights of refusal to any work you wish to independently pursue.

To the extent that you pursue it without notification, my damages are the full extent of the revenue you generate in breach.
Only an idiot would sign such an agreement
Old 01-11-2017, 01:11 PM
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Originally Posted by Jersus View Post
Only an idiot would sign such an agreement
Frankly, Mr. Jersus, only an idiot wouldn't.

I have about 150 learned professionals happily engaged under such conditions.
These are individuals whose impeccable character and credentials make it an understood and essential part of our employment circumstances.
In over 25 years, I have never once had to seek damages, not by threat, but by open and honest dealings employee to employer.
Old 01-11-2017, 01:13 PM
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Originally Posted by chrispnet View Post
You don't have a clue what Right to Work means...obviously.
As far as case law support in Florida, I'm sure your expertise in labor law is awesome, considering you don't even understand what a right to work law is, so forgive me if I don't find you the voice of authority.

As a condition of employment in my firm, I have first rights of refusal to any work you wish to independently pursue.

To the extent that you pursue it without notification, my damages are the full extent of the revenue you generate in breach.
Either way, requiring your employees funnel all work through you is unethical at best.

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