How to Earn $80,000 Per Year by Becoming a General Contractor
Steps to becoming a general contractor
- Work under a contractor as an employee, intern, or apprentice to network, gain experience and knowledge
- Pick the best position to pursue based on your previous experience
- Research state requirements
- Get exam prep to take any required exams
- Study using the exam prep
- Take any exam required
- Check renewal requirements based on your state
- Use your network to get a better fitting position
- Complete any additional training
- Start developing your client list
- Create your own business
How to pick the best type of contracting position for you
You will pick the best contracting position for you based on your previous industry and the amount the construction sites usually cost. You will also base it on the number of qualifications you can achieve compared to the pay range you want.
Your previous jobs can help point you to which industry you are in. The project height and cost are the main determining factors of the industry. If the construction is less than three stories, then you should work in residential. If the construction’s cost is less than $750,000, you should work in the small commercial industry. If the project is over three stories or over $1,500,000, then you should work in commercial. If you are not in the desired position, then search for a career change for a better fit, but make sure that it will fit better for you before you leave.
The pay range for a general contracting position is $40,500 to $130,000, with an average of $87,499. With better skill and experience usually comes a better paycheck. The more expensive the project, the higher the pay range is as well. Take more expensive projects and commercial contracting if you want to be paid more.
How long will it take?
It will normally take one to two years to get an apprenticeship. It may take two to three years to get licensed and properly trained. It may take three to four years to grow your skills enough to begin contracting, and six years to start making above-average general contractor pay. However, if you are skilled enough, you can shrink this time. You can also add trade school and even more intermediate experience in the mix like construction laborer, which will immensely aid in your ability to learn the skills required.
The exam and exam prep usually takes three to four weeks if you work part-time but five to six weeks if you work full-time. Other life events can prolong this period as well.
How much does the process cost?
You will be employed during the apprenticeship process and be able to pay off the exams and prep, then will earn more because of the license you receive.
- The fee for a residential contracting license can be $199- $973
- The fee for a small commercial contracting license can be $199- $1592
- The fee for a commercial contracting license can be $199- $1439
The bottom line is that getting your contractor license will cost you on the front end but will have a major payoff in the long run.
How to get more revenue streams from becoming a contractor
Using your skills to invest in properties
Commercial properties as an investment can be a good side income after developing your network and license. If you can get your commercial contracting license, you will have access to more properties before they hit the market. You will also have more connections with commercial investors. Commercial contractors will be not only able to build their network with clients but also potential investors. This exposure allows contractors to have insider knowledge of the market. They will also learn when to invest and how to invest through vicarious modeling.
As a general contractor, you will also be able to work on your own projects. You will not be required to pay a fee for another general contractor since you will be on sight doing the project yourself. Cutting out the middle-man will allow you to keep a larger margin cut when flipping houses and other real estate. You can also hold onto these estates and expand your portfolio for more passive income.