What To Know About Being An Independent Contractor
Independent contractors are those who work for themselves rather than as an employee of a larger company. Often, independent contractors own their business, which means they must gather clients, set up appointments, manage finances, and purchase supplies all of their own. The types of independent contractors Success Group International works with are in the electrical, HVAC, plumbing, and roofing industries.
There are many benefits to functioning as an independent contractor. Working with resources such as SGI helps independent contractors find success as well as solve some more common pitfalls that plague many in the industry. Learn more below.
Benefits of Being an Independent Contractor
A few of the main reasons why someone makes the leap from working for someone else to working for themselves are higher earning potential, flexible work hours, and independent decision making. As an independent contractor, you can often set your own hours and decide which clients or projects you will take on for yourself. If demand is high for your skill, you have the potential of earning more than what you would have if you were working as an employee of another company.
As a business owner, you can call the shots on what tools to use for jobs, how you will market your business, and what type of benefits you will receive. For someone unhappy with the decisions made by their current employer, this can all sound like a dream. Of course, there is a cost-benefit balance to keep. The freedom that comes with owning a business, however, can help some individuals thrive in their particular industry.
Lastly, another benefit to becoming an independent contractor is that you will have the opportunity to take on an apprentice or work as an apprentice yourself. This can be helpful for businesses that don’t have enough income right away to hire a full-time employee but need extra help with completing certain jobs. This will also help the apprentice gain useful skills and complete their training for certifications. Apprentices sometimes complete an apprenticeship during their schooling as a work-study program, which combines classroom instruction with real-world experience. Another path is doing an apprenticeship with a master tradesman.
Disadvantages of Being an Independent Contractor
Like any new business or start-up, there are disadvantages to consider before jumping right into ownership. For one, you will have the responsibility of paying for your own benefits. The freedom of choice over these matters can be exciting for some people, but this cost must be factored into your pricing if you plan on having benefits like medical, dental, life insurance, and vacation time.
Speaking of vacation, you may start out working odd hours as your client list grows to sustainable levels. For some, this can mean spending more or less time with family.
Financials, marketing, purchasing, and all of the other decisions a business must make from day to day are now on you when you decide to become an independent contractor. Balancing fair and competitive prices with the cost of running a business can quickly become complicated.
Once you add employees to your business, taxes and paychecks become even more complicated. Not only will you have to pay taxes for the business, but you will also have to file state, federal, and social security taxes for each employee. However, if you are a single independent contractor, you may just have to pay a self-employment tax. Taxes are not withheld from an independent contractor, so you must remember to set aside funds before tax season to avoid a nasty surprise later in the year.
How SGI Can Help an Independent Contractor be Successful
Running a business is a lot of work, whether this is your first time or not. Everyone can learn something to help them be more successful in business, which is why SGI exists. We provide independent contractors with resources on best business practices, technical and management training, and even support during times like the COVID-19 crisis to help them be as successful and profitable as possible.
We also provide independent contractors with business coaching from accomplished people in YOUR field. We know there are nuances to running your business that someone may not understand unless they have already lived it. Instead of hearing generic advice from someone outside of your industry, SGI pairs you with a business coach who knows exactly what you are facing from day-to-day. Our business coaches alone are worth partnering with SGI. They can offer you inside tips and tricks on what helped them achieve success in your field.
While becoming an independent contractor is rarely a choice made lightly, SGI can help you ease through the transition.