There are a lot of draws that make people want to be an independent contractor in North Carolina. All the benefits can be very enticing, such as working your own hours, completing projects where and how you want, enjoying the deductions that come with being self-employed, earning a higher wage, and so much more. With all of that, why wouldn’t you want to be an independent contractor?
It’s true that there is a lot to be gained from such a career path, any many people find a lot of success on it. But that doesn’t mean that being an independent contractor in North Carolina is for everyone. Before you spend all the effort and time that goes into obtaining a contractor’s license, it’s best to think about if it’s what you really want first!
Here are some things to consider before you obtain your contractor’s license to make sure that you’re cut out for the type of things that come after setting yourself up as an independent contractor.
Are You Self Motivated?
Being an independent contractor in North Carolina doesn’t mean much if you never get any clients or jobs – which, of course, would also mean you’re not getting any money. If you are an independent contractor, you don’t have a boss who’ is going to tell you what time to show up to work in the morning. Are you the type of person who can decide what time you’re going to show up to get a project done, and then stick to it?
Being an independent contractor requires a lot of self-motivation. It’s not only about getting a project done on time, either. It’s also about looking for new projects when an old one is done, to make sure that you’re not left with no work – and no income – between projects for very long.
Can You Separate Yourself from Your Work?
Even when you run your own business as an independent contractor, you still need to make sure to set aside time for what is important. Date nights with your significant other and spending time with your friends, family, and loved ones are still going to be essential parts of your life. When you’re at the top of the ladder at your own independent business, it’s likely that your phone will be going off at all hours of the day.
As a result, you need to ask yourself: Will you be the workaholic who answers every call even in completely inappropriate settings, possibly driving yourself crazy in the process? Or will you be able to set the necessary boundaries to make sure you are keeping up with your work priorities without neglecting other facets of your life?
Will You Feel Comfortable without a Stable Income?
Working as an independent contractor in North Carolina means a lot of good things – it means that you will often get paid more for the projects you complete, and you’ll also make more money as a reward for putting more time into your business. However, it also means that you won’t have a steady income as you might as a normal employee. While employees typically make the same amount of money with every paycheck, with little to no variation, your income might vary wildly from one month to the next.
There are ways to work around this to give yourself a steadier flow of income You can put all your earnings into a savings business account and distribute yourself a set amount every month. This way, even when you have a really good month, the extra money is put away to help you out for when you have a slow month later down the line. However, at the end of the day, the nature of this professional path is unpredictable. That could work out in your favor, or not – but it’s something that any independent contractor in North Carolina needs to accept about the path that they have chosen.
Will You Plan Ahead?
When becoming an independent contractor, it is important to make sure that you trust yourself to plan ahead. In most cases, independent contractors do not qualify for state unemployment benefits, as they are self-employed. Not only that, you must fund your own retirement account. Health liability insurance rates for those who are self-employed tend to be higher than those that employers secure for their employees. In addition, some clients may require that you have liability insurance.
This all may not matter very much if you are only planning to be in the independent contracting world for the short-term. However, if you plan on making this your career, it’s important to have a plan in place to make sure you have the savings for a rainy day, factor all the additional expenses that come with being a contractor into your rates, and ensure that you have some money set aside for when you do eventually retire. This kind of foresight is essential to being self-employed!
The Verdict
None of these things are intended to dissuade anyone from becoming an independent contractor – but rather, to encourage you to be prepared. At Contractor’s Institute, we make it easy to become the independent contractor you want to be with our courses!