How to Plan For Success as a Self Employed Contractor

RhumbixFebruary 01, 2019 • 4 min read

The construction industry works hard and fast. Being a self-employed contractor requires skill, organization, and a digital foreman to keep you steady. So, what does this mean for you as a contractor who’s either starting out or who wants to work smarter? Here’s how to plan and win.

Do an Honest Self-Analysis

If you’re still in the planning stages of your self-employed dream, then this is one to think about. When it comes to being self-employed, be honest – is it something you really want to do? While it may seem like money in your pocket and vacations galore, the reality could mean long hours and getting a lot of ducks in a row. But if you’re organized and thorough, you’ll ace it.

Put a Price Tag on Your Skillset

To start your financial planning, you need to know what you’ll be earning and create your game plan accordingly. The only way to do this as a self-employed contractor is to list your skills and price them up. While it’s true you don’t want to price yourself out of the market, you also should not price yourself too low. A low quote means a low income, and you’ll have to work harder to make up the difference.

Save Up a Contingency

Make sure you have a contingency fund for your business. This way, when profits are low, you can keep your business ticking over using your reserves until the market picks up again. 

Get Your Accounts in Order

One of the trickiest parts of becoming self-employed is getting your head around all the financial aspects. Keeping perfect books, knowing the tax laws and where you fit in, and preparing tax returns for the IRS are all vital. If numbers aren’t your thing, you still need to make a financial checklist. Whether you’re balancing the books yourself or not, you still need to know the ins and outs of your business. 

Investigate Liability Insurance

As a contractor, you’ll need to make sure you’re equipped with general liability insurance before you get started. This kind of insurance helps protect you against lawsuits which could put you out of business. Things like property damage, injury to clients, and issues with your work can all be covered in general liability policies. You should also look into self-employed health insurance to cover yourself in case of an accident.

Write a Project To-Do List

When you’ve got the legal and financial stuff figured out, you can start to focus on what you love – the work. Make a list of all the different operations and players from your own perspective in the construction industry. Try to understand your role on-site from start to finish. And if you have people working under you, you’ll need to understand how to manage them too. Write a list and research any points you need help with or training on later.

Go the Digital Foreman Route

A foreman has a busy role on-site and is a key player in running and completing a successful construction project. Whether you’re a foreman yourself or employ one on-site, you want to go the digital construction foreman route.

What’s a digital construction foreman? Well, they’ve got all the duties and responsibilities as a regular foreman. The difference is how they handle and organize these responsibilities. With the use of technology, a digital foreman will be able to organize photos, complete paperwork, and communicate faster and better. They’ll also have a better understanding of their workers, and keep jobs running on time.

Cut Out and Keep Leads and Prospects

When you’re self-employed, one of the hardest things is actually finding work. You may have quality skills and be a master craftsman in your trade, but if you don’t put yourself out there, nobody will find you. Sign up with construction agencies to find out about potential jobs. Canvas your local area, or up-and-coming areas, in case anyone’s looking for your skills. And sign up to websites posting leads and jobs – give yourself maximum exposure.

Plan for Your Future

Another reason many hold back from becoming self-employed is they’re concerned about the future. The usual employee perks and pension plans don’t count when you’re working for yourself. So, you have to plan for it yourself. Open a self-employed retirement account. You can opt for either the Simplified Employee Pension or a solo 401k. Consider your circumstances and requirements, and then choose the best option for your own personal retirement.

Our Top Tips for the Self-Employed Contractor

The self-employed life can be an awesome one – you can choose your own hours, spend more time with family, and build up a business your way. All you have to do to make it work is plan ahead, and the rest should fall into place. To work smarter, invest in the right technology and use (or be) a digital foreman. You’ll streamline your workload, and centralize your project management. Which app should you use? Contact us and we’ll find just the one for you.