How to Become a General Contractor in 2020

Independent Contractor

The prospect of becoming a general manager may be appealing to you if you are good at delegating work, finding the right fit for specific jobs, and are the type of person who can see the big picture. General contracting is a great responsibility but for the right kind of person, it can be a very rewarding profession. General contractors don’t do too badly in the financial department either. The average yearly income for a general contractor in the United States is $89,711 with an average of $6,750 in additional overtime pay.

And of course, if you are really good at your job and win high-paying bids, that number can certainly go up. But it takes a lot of time and dedication in addition to natural acumen to excel in this line of work. But as the ancient Chinese proverb goes, “A journey of a thousand miles begins with a single step.” Before you can begin thinking of tackling large construction or renovation jobs, you need to know where to begin. 

In the following post, we will share with you a basic guide on how to become a general contractor. Be advised that the specific rules and requirements will vary from state to state. But most states have similar guidelines. 

  • Education and Experience – One doesn’t simply up and become a general contractor overnight. There are two main paths to becoming one: you can either pursue higher education or you can gain experience in the construction industry. If you wish to go to school, construction management and civil engineering are very helpful subjects to study. You can also gain hands-on experience by getting hired by a local construction company. Be advised that no matter which route you take, you will need to set aside 3-5 years before you can really start applying as a general contractor. And in general, the best general contractors will have both college degrees and hands-on experience in the construction industry. 
  • Take the General Contractor Exam – In most states, you will have to pass an exam to get your general contractor’s license. This is going to require a good amount of studying. In most states, this is a multiple choice quiz that includes technical construction knowledge as well as business and tax questions. You can find out where and which local government body administers the test with a quick Google search. But in general, you will need to pass this exam before you can even apply for a general contractor’s license. If you need help studying, there are plenty of free online resources you can take advantage of like practice exams
  • Meet Bond Requirements – In some states, you will have to acquire a licensing bond and a performance bond. A licensing bond is a certain amount of money you will have to put up to guarantee that you will adhere to the local statutes and regulations set out for general contractors. A performance bond sometimes called a contractor’s bond is a separate amount of money you will have to put up to protect your clients should you fail to meet your contractual agreements or fail to finish the project – sort of like insurance. In most cases, you will have to put up one or both of these bonds before you apply for your general contractor’s license. 
  • Apply for your License – Once you have met the experience/education requirements, passed your state, city, or county general contractor exam and acquired the necessary bonds, you are finally ready to apply for your general contractor’s license. In most states, this means filling out a written application and providing a number of documents that can include your exam results, your driver’s license or birth certificate, background check results, your bond documentation, your proof of insurance, and proof of financial responsibility. 

Other Considerations for General Contractors

Becoming a general contractor isn’t all filling out forms and taking tests. There are a lot of practical considerations you must mull over before and during the process. 

  • Time – Here at Contractors Society of America, we get asked the question, “how long does it take to become a general contractor?” a lot. And this is an important consideration to analyze because it can take anywhere from 5-10 years to get your general contractor business up and running. Some people simply decide to work in the trades until they feel they have the knowledge to become a general contractor which can take many years. 
  • Getting Started – The general contracting business can be brutal for beginners. You will need a lot of resilience and gumption not to get discouraged because chances are, you won’t be winning a lot of high-profile bids when you first start out. And that’s perfectly ok. Something our members tell general contracting newbies when they ask “how do I get started as a contractor?” is to not shy away from smaller bids – even if you think you can handle more. Overseeing small home renovations and construction projects is a great way to build your reputation and value as a general contractor. 
  • This Work is a Learning Process – Another important thing to understand about general contracting is that it is a ceaseless learning process. You have to understand that pretty much every project will present you with a new challenge and you will have to learn and adapt on the fly. You have to be open to accepting new challenges and committed to learning on the job – even when you think you have seen it all. 

General Contracting is Rewarding

It sounds like a lot of work – and it is. But general contracting work comes with great rewards if you stick it out, are committed to improving and have a passion for seeing projects through to the end. Here at Contractors Society of America, we are dedicated to our community of professional contractors. We hope our guide on how to become a general contractor has been useful for you. Once you get your license, become a member of our community!