calculating salary for perm EE vs. consulting rate?

[robphelan]

so, i've been thinking for the past 6-8 months about going into consulting. I'd like some input on how much per hour would be a break even point from where i'm at now.

currently we have health, dental, vision, life, etc.. through my work. I would need to find a provider since I have a wife & 2 kids.

are there any general rules of thumb when it comes to calculating these kinds of things?

let's say I make an even 100k in salary. Bonuses run anywhere from 10-20% + stock options(not reliable since our stock took a big hit this year).

My wife stopped working about 2.5 years ago to stay home to take care of the kids. The older is about to go to kindergarten while the younger is only 2, so we'd like her to stay home for another couple of years.

I could find a gig here in the state, so I would fly out Monday mornings & back home Thursday afternoons, leaving me the 3.5 days in a row to be with the kids - currently, by the time I get home, they have about 2 hours max before bed time.

thanks for your input.

 

[Deeko]

I believe you also have to pay the employer's end of social security when you're a consultant. Plus things like 401k. I'm no expert on the matter but I'd estimate at least 50% more than you're getting full time to break even.

 

[JS80]

don't forget self employment tax.

 

[robphelan]

Originally posted by: Deeko
I believe you also have to pay the employer's end of social security when you're a consultant. Plus things like 401k. I'm no expert on the matter but I'd estimate at least 50% more than you're getting full time to break even.

yeah, thanks for reminding me about 401K - they match 50% up to 6% - so 3% of my sal.

 

[mugs]

If you're actually consulting (i.e. providing specialized expertise that a company lacks) rather than contracting (filling the position of a regular drone that they just don't want to hire permanently), your hourly rate would be a lot higher than what you make as a full time employee. If you're a contractor, it'd depend on the length of the contract (shorter = higher pay).

 

[Apathetic]

Don't forget to include things like down time. As a consultant, there will be some weeks where you have income (even if it's just a week or two between two big projects). Hopefully there won't be too many of them. Plan accordingly.

Dave

 

[child of wonder]

Depends on what you do as well.

Just for example, I charge about double hourly what I make as a Linux/Windows/VMWare admin to do consulting work PT.