Consulting Fees

[AZ Pete]

Derek,
Another person already commented on your math and all his points were
valid.  Additionally, I would like to add that I am unsure how you are
able to only pay 10% for tax contribution.  If you are billing $80,000
per year, you would be in the 28% (maybe even 33%) Federal tax bracket.
 That does not include AZ state tax (3-5%), and self employment tax of
15% (aka Social Secuiry).
So at a mimimum, for a $80K yearly salary a LEAST a third of that goes
to taxes and your left with $56K. Keep in mind these are only taxes and
do not include all the other expenses of running a business.
Just my thoughts :)
Peter

--- "Derek A. Neighbors" <derek@gnue.org> wrote:
> Just in case no one has done the math
> 
> 60,000 / 2080 (hours) = 28.85
> 
> Now of course there are things like a normal employers benefits (and 
> their tax contribution to factor in)  So say you figure in 10,000 for
> 
> benefits and lump 10% for tax contribution and you are at 77,000 a
> year 
> add another 10% for office supplies space etc... and you are at
> 84,000.
> 
> The other way is when you hire someone you figure 30% of salary will
> be 
> needed so if the salary is 60,000 72,000 would be the outcome so the 
> above of 84,000 is pretty high.
> 
> 84,000 / 2080 (hours) = 40.38
> 
> So I am curious to those that give consultants a bad name buy wanting
> 
> 100 plus an hour.  Do you really think that 60,000 is paltry salary,
> or 
> do you expect companies to burden your time without work?
> 
> Based on these numbers anything more than 80 an hour is HIGHWAY
> robbery. 
>  As you would only be working half a year to earn 60,000 or if
> working a 
> full year making 120,000 with full benefits etc included in the 
> calculation.  I just ask that you re-evaluate bagging on 'the
> microsoft 
> tax' if you are charging more than 80 an hour and ask are you
> charging 
> 'the consultant tax'?
> 
> ;)
> 
> -Derek
> 
> Steve Holmes wrote:
> 
> >Gee, that sounds like the Borland phenomenom; remember when Borland
> or
> >Turbo C sold for $40? Then they jacked the price up to almost #300
> or $400
> >and sales went up! Personally, I don't think a product is better
> just
> >because it is priced higher.  If everybody did that, free software
> would
> >never never make it.  I realize providing a service is different
> though.
> >
> >On Sat, 2 Mar 2002, George Toft wrote:
> >
> >>I knew a guy that was charging $35 per hour, and had so much work
> >>he couldn't handle it.  He raised his rate to $75 per hour and the
> >>work tapered off almost to nothing.  He raised it to $125 per hour
> >>and was flooded with work again.
> >>
> >>He asked one client, whose bid he lost at the $75 rate: "Why did
> >>you hire me at $125 instead of $75?"
> >>
> >>Their answer: "At $75 per hour, we did think you knew what you
> >>were doing."
> >>
> >>George
> >>
> >>
> >>Linux wrote:
> >>
> >>>Anyone who wants to pay $25.00 an hour to a consultant deserves
> just what
> >>>they get.
> >>>
> >>>I would charge no less than $65.00 an hour for the most basic of
> things.
> >>>
> >>>If you have the skills to be a true consultant you deserve _OVER_
> $100.00 an
> >>>hour.
> >>>
> >>>If anyone could do this stuff they wouldn't need you!.
> >>>
> >>>I think I'll just go sell cars........................
> >>>
> >>>Keith
> >>>
> >>>Message: 11
> >>>Subject: Re: Consulting Fees
> >>>From: Craig White <craigwhite@azapple.com>
> >>>To: plug-discuss@lists.plug.phoenix.az.us
> >>>Date: 01 Mar 2002 09:21:00 -0700
> >>>Reply-To: plug-discuss@lists.plug.phoenix.az.us
> >>>
> >>>On Thu, 2002-02-28 at 14:30, Vaiod wrote:
> >>>
> >>>>What is the going rate for general IT consultation work.  Duties
> would
> >>>>include the very basics and could include major work such as
> >>>>installing/configuring new hardware/software systems.  Just a
> general
> >>>>reasonable hourly rate is kind of what I am looking for.
> >>>>
> >>>----
> >>>I charge $70 per hour less prompt pay & volume discounts - I am
> kept
> >>>very busy. Seems to be a fair price - sometimes I feel guilty
> charging
> >>>that for simple stuff but I can make that same hourly at other
> customers
> >>>so I always have to bear that in mind.
> >>>
> >>>Craig
> >>>
> >>>--__--__--
> >>>
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