Career and Jobs

How to Make Money as an Independent Contractor

The benefits associated with working as an independent contractor are numerous.  You can set your own hours, take the jobs that you want to take, and no employer is going to take a cut out of the value of your work.  However, any independent contractor will also tell you that it’s a far riskier and more uncertain way of doing business than being an employee for another person’s company.  Before you take the leap into making money as an independent contractor, make sure you have the financial stability to support yourself without any income for a few months.  It can be a tough type of work to break into initially!


When soliciting your services as an independent contractor, have plenty of references on hand.  You are offering your services without the backing of any established company.  It’s a good idea to seek BBB accreditation and any other labels that your industry uses to communicate security and trustworthiness.  Building a strong Internet presence that links back to something brick-and-mortar is helpful.  Consider listing a physical address and office hours.

Finding Work

In order to really get established and build a strong reputation for yourself, you’re going to have to build up a client base.  Finding work can be one of the most challenging aspects of being an independent contractor.  Post your services on job boards, but try to be discriminating.  Offer your services at competitive prices, but don’t be cheap.  These are just a few of the fine lines you have to toe in order to be successful as an independent contractor.  You don’t want to appear desperate or cheap when you offer your services.  People can see through this, and they won’t be likely to hire you.  Try listing your services on Craigslist and other job boards.  If you are a creative, try sites like 99designs or CrowdSpring.

Tax Information

As an independent contractor, you are self-employed.  The IRS requires you to file an annual return and pay an estimated quarterly tax.  You pay a self-employment (SE) tax in addition to an income tax.  The self-employment tax is essentially paying into Social Security and Medicare, just like you would if you were employed by a company that withheld these parts of your earnings.


Probably the most difficult part about doing work as an independent contractor is the fact that payment can be more difficult.  Many businesses will not pay for a service until 30 days after that service is rendered.  If 30 days is too long of a period for you to not receive payment for the service you provide, doing business as an independent contractor may not be for you.  Also, it’s far more common for an independent contractor to not be treated fairly by a client/customer than a larger business.  The laws protecting independent contractors are fewer and less enforced.

Despite the difficulties associated with being an independent contractor, there are many benefits.  If you think you can provide the services you are currently providing without having an employer as a middleman, you might be successful as an independent contractor.  Having the financial backing to begin and the customer/client base to serve are the two major obstacles for most people beginning work as independent contractors.