Freelancing vs Full-Time Employment: How to Know Which Path Is Right for You
Freelancing’s true income comparison requires subtracting self-employment taxes of 7.65 percent, individual health insurance of $400 to $800 monthly, employer retirement match equivalent, and the 20 to 30 percent of working hours non-billable time consumes from the project rate that hourly comparisons typically use. Income volatility requires three to six months of cash reserves and quarterly estimated tax infrastructure whose absence produces the feast-and-famine experience. Early-career professionals lose the mentorship and organizational learning that full-time employment provides — a career development cost the income premium may not justify.
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