I'm no financial expert by a long shot, but when you say the "same pay rate" I wonder if the overall bottom line will be the same. As an employee, the employer will pay some social security, while self-employed pay it all. What about vacation time, sick leave, insurance, and holidays? An employer may or may not provide such things. Of course, a self-employed person will be able to deduct some business expenses that an employee cannot. Lots of things to think about, and there are pros and cons to both as you know.