Salary
A full time job will tell you up front what salary you get, and benefits like insurance and vacation.
You could work at a web agency, where every hour billed makes money for the company. This is the path that I took first, and it was great to learn from other experts. Since there was a design and communication focus to the agency, I got to understand the needs of big organizations and how to build technical solutions for them.
Because of how agencies make money, there is an incentive for them to tamp down on salary and push for long hours. Some are pretty reasonable, and some are more aggressive. However, they often offer end of year bonuses and company stock. You have to negotiate for what you want, and when your skills grow you can leverage that to ask for a raise or find somewhere else.
Salary work could also be as an in house developer at a company. You may get less breadth of experience, compared to multiple fast paced projects, but there could be a more mellow pace where you are responsible for more of the system stack. On the other hand, if it’s working on a startup product, it could move very quickly.
Hourly
If you set an hourly rate, it is possible to find full time contracts with the same hours as a salary. This situation often pays more for contractors, but offers no benefits and will likely end eventually or turn into an employment offer.
If you work hourly, it is more likely that the work you get will fluctuate. This can work if you have a few clients, but when it’s just one there can be some boom and bust cycles. You can negotiate things like a retainer contract - minimum number of hours you need to be paid to be available as work comes in.
I have a verbal agreement to work half time with the main agency I’m working through now. I’m leaning on an existing relationship with some trust built up, but I recommend being a little more formal so you can establish your needs and not worry about it while you work.
Fixed fee
You can negotiate a total price for work up front and then it falls on you to deliver. This can work well when you have a package offering that you know how to setup and customize, and establish a reasonable scope that you can complete within estimates.
The downside is if you underestimate what it takes, you’re on the hook to keep working until it’s done. You can set expectations that extensions may be needed and guide the client on what they can achieve now vs what to plan for the future.
Another agency I worked for earlier this year does fixed fee build projects. After the build, they work out a monthly budget or hourly rate for more updates. This kind of deal helps attract clients, but I’ve seen some builds go over budget.
Calculations
This is a very rough comparison of full time salaries to freelance work.
Full time, 2 weeks off
40 hrs x 50 weeks = 2000hrs
Full time income
- $20/hr = $40,000
- $30/hr = $60,000
- $40/hr = $80,000
- $60/hr = $120,000
- $80/hr = $160,000
- $100/hr = $200,000
Most freelancers will spend time learning, networking, and finding contracts. If you only get 1000hrs of billable work a year, you can potentially charge more to make up for it, depending on what your clients are willing to pay. Consider what you need to support yourself while you become an established developer, and pick a strategy that lets you raise your rates over time or land a high paying job.