Take permanent position? or contract?
Discussion
I'm currently contracting but have been offered a permanent position at the company. I like the place, nice people, growing business. But I feel the loss in money will mean the other half and I can't move forward with life.
My current contract will allow her to go part time, look after the house, dog and maybe start her own small business. It would mean when I'm home, everything is done, so we get good time together.
If I go for the position, it'll mean she stays full time, as I won't earn enough to 'cover' the difference in her salary. The difference take home is about 1/3, and the contract I'm on isn't that hot, so I could always earn more. But of course there are downsides to contracting, out of work, not getting paid etc. I think if the money gap was smaller, it'd be a easier decision, but I don't think I'm going to get more from them.
Her work are currently asking her to put more in, and she's at full steam already, not earning a massive amount. She's just going to melt down. We're not the best at the moment (influenced by this and other issues).
Obviously every scenario is different, but generally, what would you do? Take the secure, but less paid job, or take the risk to have more money to benefit the family.
My current contract will allow her to go part time, look after the house, dog and maybe start her own small business. It would mean when I'm home, everything is done, so we get good time together.
If I go for the position, it'll mean she stays full time, as I won't earn enough to 'cover' the difference in her salary. The difference take home is about 1/3, and the contract I'm on isn't that hot, so I could always earn more. But of course there are downsides to contracting, out of work, not getting paid etc. I think if the money gap was smaller, it'd be a easier decision, but I don't think I'm going to get more from them.
Her work are currently asking her to put more in, and she's at full steam already, not earning a massive amount. She's just going to melt down. We're not the best at the moment (influenced by this and other issues).
Obviously every scenario is different, but generally, what would you do? Take the secure, but less paid job, or take the risk to have more money to benefit the family.
What kind of contracting?
Its strange to see them only 1/3 less and even then how is it only a 1/3 less?
When I was contracting if I made £500 a day, I was really making about £550 or so.
However my take home was £3300 which put me on the £60k bracket, as anything above that is seriously taxed, Permies there would get roughly 1/2 the wage I would get.
So how does your OH dropping 1/2 her small wage to start a business and part time work, when you drop 1/3 make such a massive difference, when I assume Rule 1 of contracting is followed, 6 months wages in the bank, so that should cover the short fall when setting company up...
Sorry for being maybe a bit too nosey, its too early and I need coffee...
Its strange to see them only 1/3 less and even then how is it only a 1/3 less?
When I was contracting if I made £500 a day, I was really making about £550 or so.
However my take home was £3300 which put me on the £60k bracket, as anything above that is seriously taxed, Permies there would get roughly 1/2 the wage I would get.
So how does your OH dropping 1/2 her small wage to start a business and part time work, when you drop 1/3 make such a massive difference, when I assume Rule 1 of contracting is followed, 6 months wages in the bank, so that should cover the short fall when setting company up...
Sorry for being maybe a bit too nosey, its too early and I need coffee...
If you love the job enough that you don't want to go elsewhere then it might be worth it. Otherwise I'd start looking for a new contract. The general rule of thumb for converting is 200 * daily rate! and obviously you can accept less but 1/3rd off will be noticeable. If you're worried about being out of work then maybe your mindset isn't right for contracting? Have you got holiday money + contingency stored up? If so there's really no need to go perm unless you love the company.
out of interest what sort of combined income are we talking about ?
there was a topic a few months ago where someone said they were struggling on 100k combined.
I work full time and my partner works part time looking after our little one the rest of the time.
with her going part time we lost about 1/3 of her salary and while we are not on bankers salaries we rearranged our finances and budgets to deal with the less money.
I leave at 6:30 in the morning and am home by 6 - 6:30 in the evening see my little one and spend some time with her and my wife and while she is being put to bed I do some of the house work or cook dinner then spend some time catching up with my wife.
I don't require my dinner on the table or all the house work to be done before I get home.
I would suggest if the chores need doing before you get home from work requiring your missus to stay at home to do them then I think there is a under lying problem that money wont fix.
there was a topic a few months ago where someone said they were struggling on 100k combined.
I work full time and my partner works part time looking after our little one the rest of the time.
with her going part time we lost about 1/3 of her salary and while we are not on bankers salaries we rearranged our finances and budgets to deal with the less money.
I leave at 6:30 in the morning and am home by 6 - 6:30 in the evening see my little one and spend some time with her and my wife and while she is being put to bed I do some of the house work or cook dinner then spend some time catching up with my wife.
I don't require my dinner on the table or all the house work to be done before I get home.
I would suggest if the chores need doing before you get home from work requiring your missus to stay at home to do them then I think there is a under lying problem that money wont fix.
£500/day to get £3300 take home? Something isn't right there.
It's in IT.
I don't earn near your day rate, and my figures are not exact. But, if I took the role, there is no way she'd could go part time. Where as on my current day rate, there is.
I do not have the 6 months stored up, I've not been contracting that long, so not yet saved it up.
That is a problem, because its a good firm with nice people, and will hopefully be expanding. But it doesn't give my family what I want it to have.
I'm not worried about being out of work, just that it can happen.
It's in IT.
I don't earn near your day rate, and my figures are not exact. But, if I took the role, there is no way she'd could go part time. Where as on my current day rate, there is.
I do not have the 6 months stored up, I've not been contracting that long, so not yet saved it up.
That is a problem, because its a good firm with nice people, and will hopefully be expanding. But it doesn't give my family what I want it to have.
I'm not worried about being out of work, just that it can happen.
Edited by Jobproblems on Thursday 21st May 08:43
colinjy said:
out of interest what sort of combined income are we talking about ?
there was a topic a few months ago where someone said they were struggling on 100k combined.
I work full time and my partner works part time looking after our little one the rest of the time.
with her going part time we lost about 1/3 of her salary and while we are not on bankers salaries we rearranged our finances and budgets to deal with the less money.
I leave at 6:30 in the morning and am home by 6 - 6:30 in the evening see my little one and spend some time with her and my wife and while she is being put to bed I do some of the house work or cook dinner then spend some time catching up with my wife.
I don't require my dinner on the table or all the house work to be done before I get home.
I would suggest if the chores need doing before you get home from work requiring your missus to stay at home to do them then I think there is a under lying problem that money wont fix.
I don't require it! I just imagined she'll 'run the house', and will generally tidy up a bit. It's also to lower her stress levels, she's not coping very well with work as is, so I want to ensure shes happier.there was a topic a few months ago where someone said they were struggling on 100k combined.
I work full time and my partner works part time looking after our little one the rest of the time.
with her going part time we lost about 1/3 of her salary and while we are not on bankers salaries we rearranged our finances and budgets to deal with the less money.
I leave at 6:30 in the morning and am home by 6 - 6:30 in the evening see my little one and spend some time with her and my wife and while she is being put to bed I do some of the house work or cook dinner then spend some time catching up with my wife.
I don't require my dinner on the table or all the house work to be done before I get home.
I would suggest if the chores need doing before you get home from work requiring your missus to stay at home to do them then I think there is a under lying problem that money wont fix.
If I contract, we'd be looking at similar figures, but we'd not be struggling! If I went permi, it's obviously a lot less.
Doesn't sound like something you want to do, probably doesn't mean they want you to stop contracting for them either?
Without knowing how much local contract work there is, how likely you are to get another contract, what scope there is to raise your day rate, etc, it's impossible really to give any useful advice. It's a judgement call. I would say though if you keep contracting even elsewhere they'll likely keep the door open for you if they're expanding. If you decline just do so politely and explain it's not the right move for you at the moment but that you're pleased to have been asked.
Without knowing how much local contract work there is, how likely you are to get another contract, what scope there is to raise your day rate, etc, it's impossible really to give any useful advice. It's a judgement call. I would say though if you keep contracting even elsewhere they'll likely keep the door open for you if they're expanding. If you decline just do so politely and explain it's not the right move for you at the moment but that you're pleased to have been asked.
Jobproblems said:
£500/day to get £3300 take home? Something isn't right there.
I assume the rest stays in his company - after £3300/month you pay higher rate tax on dividends.Forget the money for a minute. What else does going perm offer you? Security? Contract or perm, we are all a month/three away from redundancy or the firm going bust etc
Could it give you training, promotion to a new role, stability to start a family etc..
I turned down something similar and got a much better job elsewhere.
Jobproblems said:
I don't think I'll be contracting for them after I say no.
Haven't looked locally, but will be.
I understand without knowing everything, it's hard, just after a general wondering.
My general principle is to put family ahead of work. However, I'm not career-minded; I'm not interested in climbing the corporate ladder. That makes me a good fit for contracting.Haven't looked locally, but will be.
I understand without knowing everything, it's hard, just after a general wondering.
small company, but expanding. so a new role may appear.
I left a permi role to contract, so I had the flexibility, so I could be at home a day or 2 a week etc.
My accountant didn't tell me about the dividends rule, just to take a % out every month after my 'salary'. Think i need to re-evaluate!
I left a permi role to contract, so I had the flexibility, so I could be at home a day or 2 a week etc.
My accountant didn't tell me about the dividends rule, just to take a % out every month after my 'salary'. Think i need to re-evaluate!
Jobproblems said:
small company, but expanding. so a new role may appear.
I left a permi role to contract, so I had the flexibility, so I could be at home a day or 2 a week etc.
My accountant didn't tell me about the dividends rule, just to take a % out every month after my 'salary'. Think i need to re-evaluate!
Ok base rules are.I left a permi role to contract, so I had the flexibility, so I could be at home a day or 2 a week etc.
My accountant didn't tell me about the dividends rule, just to take a % out every month after my 'salary'. Think i need to re-evaluate!
1) declare nominal salary say £850 a month, this you will pay NI/PAYE
2) the above means you can pull the rest (up to £43k last time I looked) in equal monthly instalments.
3) if getting above £70k declare yourself VAT registered and get on flat rate scheme, that way when you charge the client VAT (20%), you keep a slice (5.5%) and pay the rest to HMRC.
4) have insurance.
5) claim as much as legally allowed on everything else.
6) finally pay corp tax on the remaining profits.
Done.
(if your accountant is not doing the above as the norm, then I would query it with them.)
Du1point8 said:
Ok base rules are.
1) declare nominal salary say £850 a month, this you will pay NI/PAYE
2) the above means you can pull the rest (up to £43k last time I looked) in equal monthly instalments.
3) if getting above £70k declare yourself VAT registered and get on flat rate scheme, that way when you charge the client VAT (20%), you keep a slice (5.5%) and pay the rest to HMRC.
4) have insurance.
5) claim as much as legally allowed on everything else.
6) finally pay corp tax on the remaining profits.
Done.
(if your accountant is not doing the above as the norm, then I would query it with them.)
Thanks. I'll deal with that after I've decided!1) declare nominal salary say £850 a month, this you will pay NI/PAYE
2) the above means you can pull the rest (up to £43k last time I looked) in equal monthly instalments.
3) if getting above £70k declare yourself VAT registered and get on flat rate scheme, that way when you charge the client VAT (20%), you keep a slice (5.5%) and pay the rest to HMRC.
4) have insurance.
5) claim as much as legally allowed on everything else.
6) finally pay corp tax on the remaining profits.
Done.
(if your accountant is not doing the above as the norm, then I would query it with them.)
Jobproblems said:
Du1point8 said:
Ok base rules are.
1) declare nominal salary say £850 a month, this you will pay NI/PAYE
2) the above means you can pull the rest (up to £43k last time I looked) in equal monthly instalments.
3) if getting above £70k declare yourself VAT registered and get on flat rate scheme, that way when you charge the client VAT (20%), you keep a slice (5.5%) and pay the rest to HMRC.
4) have insurance.
5) claim as much as legally allowed on everything else.
6) finally pay corp tax on the remaining profits.
Done.
(if your accountant is not doing the above as the norm, then I would query it with them.)
Thanks. I'll deal with that after I've decided!1) declare nominal salary say £850 a month, this you will pay NI/PAYE
2) the above means you can pull the rest (up to £43k last time I looked) in equal monthly instalments.
3) if getting above £70k declare yourself VAT registered and get on flat rate scheme, that way when you charge the client VAT (20%), you keep a slice (5.5%) and pay the rest to HMRC.
4) have insurance.
5) claim as much as legally allowed on everything else.
6) finally pay corp tax on the remaining profits.
Done.
(if your accountant is not doing the above as the norm, then I would query it with them.)
the company mankes its annual turn over, then deduct salary/ expenses/ operating costs, you pay 20% corporation tax on that figure, then you can take a dividend out. not just pull £40k out and then pay 20% tax on whats left.
Recruiter here.
Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
When I was contracting I saved a lot but could not stomach to put in pension as it would be stuck there. Now staff and earning less than half (by quite a bit in take home) but my pension is VERY good....my job is more secure and there are more opportunities. So many factors to weigh up as well as how good the staff benefits are and how much money you have now and need it in the future
remkingston said:
Recruiter here.
Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
Depends in the skill set. I know contractors who had no trouble paying for school fees and 911s for a decade or two then suddenly found themselves out of work for months at a time since they hadn't kept their skills up to date. Getting experience in new skills is much easier to do as a permie than as a contractor.Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
Dr Jekyll said:
remkingston said:
Recruiter here.
Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
Depends in the skill set. I know contractors who had no trouble paying for school fees and 911s for a decade or two then suddenly found themselves out of work for months at a time since they hadn't kept their skills up to date. Getting experience in new skills is much easier to do as a permie than as a contractor.Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
If one doesn't stay on the ball then the opportunities shrink.
This is the reason, in my opinion, why the majority stick with perm; it's easier to keep doing the same for less than to take the risk for more.
Edited by remkingston on Friday 29th May 15:46
remkingston said:
Dr Jekyll said:
remkingston said:
Recruiter here.
Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
Depends in the skill set. I know contractors who had no trouble paying for school fees and 911s for a decade or two then suddenly found themselves out of work for months at a time since they hadn't kept their skills up to date. Getting experience in new skills is much easier to do as a permie than as a contractor.Contractors that are top of their game earn more money than perm staff all day long. They are in demand and are able to be flexible with the rate.
Those wanting perm are normally after the perks of sick pay, holiday etc.
If you are awesome at what you do then you have security.
I'd recommend staying contract just on a financial basis.
If you one doesn't stay on the ball then the opportunities shrink.
This is the reason, in my opinion, why the majority stick with perm; it's easier to keep doing the same for less than to take the risk for more.
I get benefits of permanent staff
Plus:
Job interviews are 30 minutes instead of 4/5 interviews per role, so no more tech test after tech test, they believe what the consultancy says about my skills.
If I do a job outside of my local area (6 months in Europe) I use the company apartment FoC.
Lots of training available, Im looking at Professional Risk Managers' International Association (PRMIA) Course and PMI, the only payback is to train/teach others at the consultancy.
If I don't like a job, the company are more than happy to pull me in 1-3 months and move me to another one.
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