I just accepted a job offer for a four-month IT contract (not development) at a very large bank. My recruiter says they frequently extend people in this position and often hire. The pay is a lot more than I've been making. It's a W-2 contract, not 1099, so I don't have to worry about taxes just yet.

I know how I will handle the finance part of this move: COBRA for now, save everything extra until my emergency fund is 12K, then return to our regularly scheduled debt repayment plan and figure out health insurance. However, I haven't contracted before. I've temped, but not at a professional level, particularly not with the expectations of the wage they are paying me.

Any advice for being a contractor? I know from the interview that they have a set process I will be helping implement -- I'm doing things, not fixing them. I will not be managing people or projects; I will have a stack of work I need to take care of quickly and accurately, and I will work with people mostly by phone.

I would like to make sure they want to extend me (even if I decide otherwise).

If you're fairly certain you'll be extended or offered a full-time position, then I wouldn't advise building your savings all the way up to $12,000 before attacking that debt. I'd say with relative job security, a 1-month emergency fund would suffice while you paid off the debt. Then go build up the fund to 3-6 months.

I'm not certain, because I haven't done contracting before; I might mess up. I'm also rather more pessimistic about the economy. My debt is all very low interest, so that doesn't concern me. I'm specifically looking for advice on contracting, not finances.

I'm an IT recruiter that places people in positions exactly like they one you are in.

Some general tips:
1. Communicate. Constantly. Don't let them forget you are there.
2. Ask for more work when you are done with your current task. Don't twiddle your thumbs. Seems elementary but you would be amazed at the number of people who don't get perm offers because of this.
3. Keep up communication with your staffing firm as well. They should be staying on the client to get you a 30 and 60 day review -- make sure they do that.
4. Ask how you can improve.

Let me know if you have any other questions... and best of luck!

Thank you! This is exactly what I was looking for. #3 is particularly valuable -- I didn't even know I _could_ ask for that. But it would be really great to have.

It's part of our regular process. But not everyone does it.

W2 contracting or 1099?

W-2. At a really amazing rate! Which is part of why I am scared: am I really worth this much money?

(Actually, by all objective measures, yes. Someday I will convince my brain.)

I would probably be better off with 1099 contracting, but being w-2 will ease the transition. And the recruiter has been very nice to work with.

I actually was in your shoes last November when I moved to a W2 contract. I was in the middle of buying a house and I was unhappy at my current job. The pay would have been more than double factoring in the overtime. A lot of contract positions advertise being converted to a permanent employee. Many times this doesn't happen, either your let go at the end of your contract (especially on project contracts) or you are kept in a perpetual contract loop because of the favorable accounting the company gets and the money your agency (pimp as its sometimes called) makes off the deal. First and foremost get your COBRA squared away and start saving an emergency fund in a high yield savings like ETrade savings, ING, etc. I found my COBRA crazy expensive for me and knew I could get cheaper being in my early 20s. I would go to ehealthinsurance.com and look at plans. I ended up keeping the vision and dental COBRA because it was cheap and got a high deductible plan on ehealthinsurance. I think high deductible plans are the best thing to happen to the health insurance in the US. If you don't have any major or chronic health issues I would look into them and HSAs.

Many people are scared to contract because of the instability that comes with it. You will find that once you have a emergency savings, health insurance, and disability insurance you won't worry as much as you will be able to adsorb unemployment. Also stay in contact with your agency and if something happens with the client, let the agency deal with it. They have a financial incentive to keep you employed because every hour you work they make money. Keep in mind many IT contracts are doing and not fixing that way they can layoff once the project is done, and then are not responsible for unemployment, severence, COBRA, etc. One last thing to keep in mind is contractors are typically treated like second class citizens. Your not invited to company events, may not have access to the cafeteria, etc.

@z130: I agree with some of your points and disagree with others.

The bottom line is it depends on your agency. Work with a big, reliable, well known company.

The contract-to-hire positions we advertise are intended to go permanent. Clients do change their minds, but we don't lie about it. We are completely up front with our candidates with as much information as we know.

Yes, the agency makes money by putting you to work. That's why they are in business. But a long term lack of commitment to actual living up to our word would be disastrous for the firm long term because it ruins the firms reputation in the market. No smart firm will sacrifice long term results for short term revenue.

We make decent insurance available with various coverage options (med/dental/vision). Many firms say good luck with your insurance.

I'm 50/50 with your second class citizen comment. It all depends on the client. Just like any other job. We have contractors who love being contractors at their clients. We have some that just shrug things off. One side benefit of the contractor is you don't have to put up with the politics in the office -- you are there to just get the job done.

My two cents.

You're worth the amazing rate. The hiring company gets the benefit of a hired gun without any of the commitment. You walk in and solve problems. They don't have to put you on regular payroll or deal with HR headaches.

If you divide your rate by 3, does it come close to what you'd normally make per hour?

Nah, not yet. Dividing by 2 is closer. It's 175% of what I made.

What if I changed my mind as a contractor with the contract-to-hire deal? I might decide I really prefer contracting.

A friend helped improve my resume, and since I've posted that I've been getting a lot of emails about potential jobs. I've been telling everyone my contract expires in 4 mo, and to feel free to try me then....

Bottom line is your obligation is for the contract. If they offer you a full time gig and you don't find the offer acceptable, you don't have to take it. (And your firm will hopefully be able to re-place you.) Keep up the networking -- hard. You'll need it.

I didn't think it would be a problem, and I'm pretty sure that I'd be able to replace myself -- I've been trying to do referrals, too.

Networking is something I'm practicing with, a lot. I need "The Introvert's Guide to Networking: How to Get the Most from Your Limited Social Tolerance."

Daedala, if you go to my blog, I believe I have a few posts on networking for introverts. Try searching on introvert.