Full-Time vs Freelance Rate Comparison
When transitioning between salaried W-2 employment and freelance or 1099 independent contractor arrangements, comparing raw hourly compensation is misleading.
Contractors are typically responsible for both the employer and employee portions of self-employment payroll taxes (FICA), along with unsubsidized health insurance, retirement contributions, and unpaid vacation weeks. Rule of thumb: a freelance rate should be 25% to 35% higher than equivalent salaried hourly compensation.