Breaking down the barriers to change

Taking a step forward to working for yourself could feel daunting, but the resistance is often mental rather than practical setback. This guide will show you how to break down the barriers to change and start your contracting or consulting business with peace in mind.

Overcoming the barriers to change

Contractors and consultants agree that the perceived lack of security or stability is among the biggest challenges of starting out for the first time. Securing enough contracts to ensure a constant income stream and minimal gaps in employment is critical when leaving the comfort of a full time job. Achieving the right set up of your limited company and reporting the correct figures to HMRC is another barrier that stops many people from taking the next step. With a bit of research and advice from experienced advisors your new business can be formed in no time. All it needs is your commitment and confidence that you’re doing the right thing.

Regaining your comfort

Running your own company and working for yourself gives your the control over your future and brings bigger financial rewards than your previous permanent role. From now on your income is directly tied to your achievements, so being more efficient, dedicated and hard-working would fill up your bank account faster. As a director of your company you’ll also have the freedom to allocate your accumulated hourly income over holidays, healthcare, and perks of your choice, rather than being given standard packages as an employee. Thus you’ll be able to create the stability you need and determine a career development path of your own choice. Here’re several tips from seasoned contractors who’ve walked in your shoes and speak from experience.

Choose contracts matching your long-term goals

Make sure every new project you take gives you access to new experience or skills. Keep an eye on your wider personal and professional development goals and use the opportunities to build your expertise, even if they’re not the top-paid options.

Look far into your calendar

Know the end of your current contract and plan the next in advance to minimise periods of inactivity. Don’t leave it for too late unless you prefer to schedule breaks between contracts.

Establish relationships

Maintain a healthy relationship with your recruitment agents to ensure you’re top of mind when sourcing their clients. Treat everyone you work with as a potential client of the future. People buy from people – you are your biggest asset and you need to ensure that you portray yourself as you want to be perceived at all times.

Save for rainy days

Sometimes things go against the plan when unforeseen circumstances come in the way. It’s prudent to save at least three months’ earnings in case of contract gaps. Contingency fund against dry spells would keep you safe and minimise the adverse impact on you and your business.

Keep your skills fresh

Keep an eye on changes in your industry, update your skills, attend training courses and events. This will help your stay competitive and make the most of your career while looking after your personal development plan.

Reduce the risks

Cover yourself and your business with the right insurance plan to minimise economic risks. Shop around to find one of the many tailored packages for independent business owners and give yourself peace of mind. Sometimes an insurance cover could be a standard mandatory requirement from a bigger corporate client.

Getting help from professionals

The rewards of running your own business are one aspect, but setting things right at start requires a high level of attention and responsibility. Consider the aid of experts to help with the administration of your business and simplify your experience as a new business owner.

Neil, now a seasoned IT contractor and multiple business owner, remembers what it was like starting out.

“Business stability was a big thing for me and part of that was ensuring that HMRC are satisfied with my submissions. Don’t try and do the numbers yourself; delegate and employ experts to look after the financials and dealings with HMRC. It’s great being involved, but you need an expert to check it’s all correct and submitted properly.”

This is echoed by many other contractors. But it’s not just about making sure the figures add up.

A reputable accountant, a contract and IR35 specialist and an independent financial advisor are the three experts to ensure your business is set up to run smoothly and you don’t waste valuable resources and money trying to fix things after the fact. They can potentially save you more time to win contracts and clock more billable hours. Read on to discover why trying to scrimp on hiring experts is false economy and how to prevent errors that can lead to fines and investigations. Visit the full version of this guide here – Becoming a contractor – break down the barriers to change.

Image by Juan Antonio Capó Alonso.