As you begin your career as an independent IT consultant, you’ll find yourself faced with a sea of choices to make and decisions to make in order to build a solid foundation for your business. From incorporation to pricing, choosing your accounting software and structuring your contracts, every decision is important and shouldn’t be left to chance. However, one choice that can sometimes give you headaches is: which financial institution should I choose to support my business?
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Privileged access to the technology ecosystem
Any experienced independent IT consultant will tell you. Networking and being on the lookout for opportunities is the key to progress.
For example, during a webinar entitled “How to structure your freelance business” organized by Desjardins Caisse des Technologies and Le Wagon Montréal, Serge Calixte, an independent consultant since 2008 and former president of AQIII, stressed the importance of networking for IT consultants. During the interview, Serge shared his experience as an independent IT consultant, then, at the end of the interview, he was asked the following question:
What advice would you have liked to have received when you started out as an independent IT consultant in 2008?
He answered without hesitation:
Learn to network « … » It’s not when you lose a big contract that it’s time to network. You need to stay involved in your circle of expertise and maintain good contact with your peers. That’s how you can position yourself and seize new opportunities in your sector.
Serge Calixte, Consultant TI indépendant
How should a financial institution support IT consultants in their networking?
Ideally, a financial institution should help you develop your professional network. This is particularly crucial in the technology field, where the exchange of knowledge and opportunities is constant. The professionals accompanying you should be familiar with, or passionate about, the technology field, in order to understand and anticipate your specific needs.
As a strategic partner, your financial institution should develop and maintain close relationships with key players in your sector, for your benefit. This could take the form of partnerships with various technology organizations, organizing networking events, or negotiating discounts with preferred partners.
The main objective is to provide you with favorable opportunities to develop your IT consulting business, whether by obtaining passes to major events, access to networking activities, partner discounts or other advantageous offers from the technology ecosystem.
Ultimately, a financial institution that lives up to your expectations should constantly seek out and exploit opportunities to foster your growth and success.
Facilitating access to property for IT consultants
As soon as they sign their first contract, most new IT consultants opt for incorporation to take advantage of the tax benefits it offers.
This is totally understandable, since most go from employee to independent IT consultant, doubling or even tripling their income. In order to reduce their tax impact, they pay themselves a salary and/or dividend similar to their previous employment income, then keep the balance of profits in their management companies.
On the face of it, this is the logical thing to do. However, if you want to take out a mortgage during your first two years of incorporation, it can get complicated, even if you pay yourself the same salary and/or dividend as you did at your previous employer.
It’s important to understand that financial institutions that aren’t used to dealing with entry-level incorporated IT consultants won’t authorize mortgages unless you can show :
A minimum of two years’ income (two notices of assessment) as an independent consultant, even if your downpayment is more than 20%.
A financial institution familiar with the realities of IT consultants should be able to assess your financial situation in a more comprehensive way. This means taking into account your previous experience as an employee, even if you’re starting out as a self-employed IT consultant.
When evaluating a mortgage pre-approval or approval for a self-employed person, here are the factors such an institution should consider:
Analysis of your last two notices of assessment, even if you were employed during that period.
Consideration of your incorporation’s net profits for financial projections.
In addition, a financial institution should facilitate the process if you hold your business account there. The goal is to have an overview that allows advisors to make a 360-degree analysis of your personal and professional needs. In addition, by recognizing and valuing your past experience in the technology field, the institution may facilitate your access to credit. This can include credit cards, lines of credit and mortgages, even if you only have a short period of activity as an incorporated independent IT consultant.
The path of an IT consultant
Specialization offers a major advantage: the ability to anticipate next steps and constantly improve the service offering. An attentive financial institution should be able to anticipate these milestones and effectively support IT consultants at every turn in their careers.
These institutions are fortunate to see their members evolve along similar career paths. Over time, they put in place various strategic partnerships and resources to support IT consultants in growing their wealth, both professionally and personally.
A few key steps for IT consultants
First revenues
As you begin to generate your first revenues, qualified advisors should be able to guide you in organizing your accounts to anticipate taxes and ongoing fees, as well as maximize your returns.
Significant gains
When you’ve got a lot of money coming in, some IT consultants will want to manage their investments themselves with an online brokerage account, such as Desjardins’ Disnat application, while others may be interested in buying income properties. Whatever the case, financial advisors should be able to answer your questions and guide you in making the best decisions regarding the organization and management of your wealth.
Loss of contract
Since it’s always possible to lose contracts along the way, financial advisors should be able to help you set up a contingency fund, and give you access to credit facilities to support you when it matters most.
In short, every situation is unique, and the advice offered by a financial institution should be tailored to the nature of your projects and activities.
Why consultants choose Desjardins Caisse des Technologies
In conclusion, navigating the world of consulting can present its own unique set of challenges. Whether it’s anticipating and planning your professional growth, maximizing your revenues, or effectively managing the inevitable contingencies, every IT consultant deserves to deal with a financial partner who truly understands your reality.
at every stage of their careers. Thanks to our in-depth knowledge of your field, our advisors are able to understand your specific needs and provide solutions tailored to your situation.
Contact Caisse Desjardins des Technologies today and find out how we can help you succeed and prosper in your field.
Contact details :
Wealth Management team
514-393-9552, poste 7157280
asf.92239@desjardins.com
