The very best tip for new IT Contractors is that they should not change their lifestyle
too much for at least the first year of contracting.It is very tempting for new contractors to start spending a lot more money as they are now earning a lot more.
Some even borrow money against their new higher disposable income to buy the things they always wanted.Too often these contractors are taken by surprise by a spell out of work while still having to pay the interest on the flash cars and houses that they bought.It is difficult to tell contractors just to spend the same amount as they had done as a permanent worker for the first year of contracting but few would heed this advice.
So, what I will say is that you should allow yourself to increase your spending a little but that you should put off any major purchases till your second year of contracting or till at least you have six months under your belt and a good cash pile to rely on.You should stockpile enough cash to be able to survive at least 6 months out of work before you start making major purchases.
You will also find that, as a contractor, it's not only the holidays and sick pay that you don't get which you got as a permanent worker but that you no longer get a company pension.As you are now in a riskier profession it would a good idea to take out some IT Contractor Insurance
Many companies are insisting, nowadays, that contractors take out Professional Indemnity Insurance in case anything goes wrong on the project and you are to blame.The last thing you want is to be sued by your client for costing them a lot of money through a mistake by you.
If the company you worked for had health insurance you will obviously find that you are no longer covered and need to take out contractor insurance for your health and that of your family if you have one.
There are lots of contractors insurance products on the market and it is wise to choose which one suits you best.When you start that first contract, really knock yourself out at the start to do a good job.You will make your reputation for good or bad in the first month.After that impression has been made it will be hard to change it either way.
Then the renewals and rate increases will start coming.If you can take this advice you can have a long, successful and lucrative career as an IT Contractor.