[gigantor]

Contracting pays more since the employment term is fixed and job security is 'less guaranteed' than a salaried position. Also, finding a new gig every few months, learning systems from scratch, and being embedded into a brand new environment frequently is not for everyone.

One advantage of contracting is that you can get a nice long break when you're done (i.e. being between contracts). Depending on your ability to budget financials for this time that you're out of work, ability to find new contracts, and motivation level when unsupervised, you can use this time to focus on a company. In a likely scenario, you can make the same net amount in 9 months as you would in a year for equivalent work after taxes, all depending on your negotiation skills and gap between salaried and contract pay, leaving 3 months to focus on your company.

Get a good accountant, it's well worth the cost in tax savings. As others said, watch for the big tax bill at the end of the year, or you can work with your accountant to pay taxes in monthly periods. A staffing agency is sometimes easier to deal with for taxes since they handle service taxes, if applicable.

Get good at doing interviews, since you'll be looking for new work once or twice a year. Recruiters are often a necessary evil so be good to them. Contractors also naturally have better networks since they move around so often and make new friends.