Making the decision to become a contractor can be an exciting one. You’ll be able to take more control, giving yourself increased flexibility as you work on projects that you can really be passionate about. However, if you ask any contractor, they will tell you the one major downside – some periods are a lot quieter than others.

Knowing that you do not have a guaranteed workflow can be a scary thought. But there are ways to prepare for the peaks and troughs in contracting. In this post, we’ll explore how you can remain in control by planning ahead and even using contractor income protection.

Planning ahead

The best way to deal with downtime as a contractor is to plan ahead. There are a few ways to prepare for these troughs in contracting, but the simplest way is by taking full advantage of your peak periods.

Put money aside

It’s so easy to spend most of your income as soon as you get it but putting money aside can protect you should work dry up. Start by tracking your expenses, keeping an eye on how much you spend and on what. Use this to identify what purchases could be cut out, and how much money you’ll have left to create a fixed budget with.

Many financial experts recommend using the ’50, 30, 20’ split. This is where 50% of your income goes on necessities such as rent/ mortgage and bills. Then keep 30% for your more flexible purchases and save the remaining 20%. This will leave you with a good level of income to fall back on should you land in any trouble in the future.

Build client relationships

When you take on a project, ensure you build a good relationship with the client as those close working bonds can lead to future work. Additionally, the better you know a client, the easier it is to pick up some extra work should you need it. You’ll also be in a better position to book projects with them in advance – when you know things will be a bit quiet.

Work on yourself

Quiet periods are a great opportunity to work on yourself. Rather than watching the tumbleweeds roll by, you can develop new contacts, improve your skills, tidy up your business admin or come up with an optimised business plan.


All it takes is a quick Google search to find a couple of great networking events locally. Head on out, enjoy a free cup of coffee and meet local business owners who could be your next big lead.

Skill development

Use your extra time to polish up on some of your skills. Upskilling can be a great way to move on to higher rates. Gaining those extra qualifications can demonstrate that you have the expertise to deliver a project to a high standard. It can also be a good chance to diversify your skill set, allowing you to expand your service offering.

Clean up your business admin

When you’re in a busy period, it can be easy for things to get lost in the whirlwind. Take the time to organise your paperwork and even start working on your finances.

Get a head start on your self-assessment returns and make sure all your numbers are adding up. This can be a great time-saver, especially if it comes to the end of the financial year and you’re in the middle of an intense project.

Take a holiday

While not everyone considers taking a holiday as ‘working on yourself’, having a few days away from it all can be a great way to hit reset. If work has slowed down for a short period, it’s a better chance than any to relax and give your mind the chance to refresh. When you return, you’ll be re-energised and focused.

When booking time off, especially if you are mid-contract, it is important that you do not use the same holiday booking systems as your client. If you use the same procedures, you could be seen as inside IR35 which will affect your tax. Instead, politely inform them that you will not be available and avoid those booking forms.

Contractor income protection

Another fantastic option that can ensure you remain financially secure is by ensuring you have contractor income protection. If this is something you choose to explore, it is important that you fully investigate any policy you find as some of them can catch you out.

Exceptions in insurance policies

Insurances that claim to cover periods of unemployment feature heavy exemptions that make successful claims a rare occurrence. For example, some policies are only in effect if contracts last at least 12 months, despite this being very rare for contractors.

Reliable policies

There are some reliable protection policies out there, along with different policy options. For contractors with families, you’ll be able to find insurance cover that will provide a lump sum of money should you be out of work for reasons out of your control, such as illness.

Alternatively, you can take out contractor income protection, which is also referred to as permanent health insurance. Through the policy, you’ll continue to receive income that protects your standard of living. And, regardless of how much you claim, your insurer cannot cancel the policy.

Umbrella companies

As a contractor, one of the best ways to remain financially safe is by utilising an umbrella company. They can take care of your invoices, ensure clients pay on time and remove the stress of understanding tax requirements. One particular benefit is that many do offer contractor income protection.

Amongst some of the other insurance and health packages umbrella companies offer, income protection packages are a welcome reassurance for many contractors. This is because they’ll often be added on to the service with minimal extra fees, ensuring contractors keep most of their income while safeguarding their future.

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