How to Track Time as a Contractor

You spend the entire day working and feel like you have gotten a lot of work done by the end of the day. However, when you check the tasks you have accomplished, you have barely checked off a couple of items from your to-do list. Now, you are wondering where all the time went and how you can manage your schedule better to be more productive. This is why tracking your time is not optional, whether you are a new contractor or have a significant level of experience under your belt. Here’s how to track time as a contractor. But first, let us first look at some of the primary benefits you can achieve by tracking time as a contractor.

Top 5 benefits of tracking time as a contractor

If you know of contractors who use to-do lists, task management tools, and AI chatbots for customer support or to track their time and schedule, you must have wondered why. To shed light on this, here are some benefits contractors can expect by implementing effective time-tracking practices:

1. A more organized schedule

Most contractors do not have a set timetable for a typical workday and generally have a high degree of freedom when managing their time. However, this freedom is not always a good thing, as it can lead to procrastination or bury the contractor under the burden of responsibility. Regardless of how flexible their schedule is, contractors must track their time to stay organized and prioritize their tasks so they can be more productive and make the most out of each day.

2. Increased visibility

Most contractors utilize time tracking to gain more visibility and insights into their time management and help them identify potential improvement areas. You can take a deeper look into your work hours and determine which specific areas require more optimization or attention.

Contractors can then use this increased visibility to better manage client expectations by providing regular updates on project progress and timelines. You can also identify patterns and trends in productivity and make adjustments accordingly.

3. Clarity on project progress

Having more control over your time means having more control over your projects and deliverables, which is a necessity for contractors. Tracking time helps you gain more insights into the progress of each project, estimate how long it will take for a task to be executed, and assess its impact on billing.

By doing so, you can also identify the tasks that have been slowing down the overall project and implement changes that will help expedite them.

4. Better cash flow and billing processes

The more clarity you have about your projects and the timelines associated with them, the more improvements you can bring to your cash flow management. As if the standard construction tax deductions and complexity of billing policies are not enough, ambiguity in your timesheets can further disrupt your billing and invoicing processes.

You can even prevent any potential payment disputes that may arise as a result of overcharging or underpaying. Here’s how to justify your invoices to your clients.

In addition, with the help of time tracking, contractors can generate highly accurate bills for clients, thus eliminating any confusion or errors. Nowadays, invoices can be generated automatically by turning time entries or finished tasks into invoices. Here are the best invoicing software on the market.

In relation to billing processes, project management software with finance and profitability tracking will help you down the line, so make sure to invest in one tailored to your needs. Here’s a guide to project profitability.

5. Implementing work-life balance

While having complete control over your time and schedule might be a lucrative part of being a contractor, it brings its share of challenges. For one, because of the ambiguity in the schedule, you might find the lines between work and your time blurring more than you’d like.

If you want to be highly productive and efficient, you must plan your schedule and set time aside for personal commitments and breaks. Otherwise, if you continue working continuously without tracking the time you dedicate to each task, you might burn out and disrupt your work/life balance.

Remember that achieving work/life balance can help you improve your personal and social life.

Actionable tips for effective time tracking as a contractor

Now that we have looked at the numerous benefits you can achieve by tracking time as a contractor, here are some of the useful tips you must follow in the process:

1. Establish a time-tracking system

It may be difficult for contractors to bring self-discipline into their tasks and projects, but implementing an organized system to monitor the work hours is a good start. While contractors traditionally used stop-watches and pen-and-paper techniques to track time, you can now implement time tracking software and tools to automate time tracking and help you manage deadlines more effectively.

Download Paymo Track, the free desktop app, to keep track of all your work.

At the very least, these tools can help log the time you spend on each project, making it easier to:

• Invoice clients accurately
• Monitor productivity levels
• Gain visibility into team workloads
• Reduce wasted hours and streamline project management
• Manage resource and administrative costs

Time-tracking apps and software maintain records and timesheets that you can review later to analyze and generate proper estimates for future projects.

Here’s how time entries are logged automatically as a timesheet:

2. Keep your focus on the important tasks

As a contractor, you may often lose track of your important tasks and projects when juggling multiple ones. However, you must constantly seek to prioritize the most pressing ones and concentrate your energy on them so you can manage your deadlines and time efficiently.

Mark the important tasks and projects and try to tackle them before everything else. If you utilize a time-tracking or productivity tool in the process, you must also set reminders and alerts that will help you prioritize the crucial tasks first.

3. Take regular breaks and time off

While the primary motive of time tracking for contractors may be to boost productivity and efficiency in projects, you must also consider using it to schedule dedicated breaks. Regular breaks and longer holidays can help you maintain optimal levels of productivity and even help you maintain a better schedule.

Scheduling regular breaks between tasks or projects can help you relax, prevent burnout, and give you time to recharge yourself for the next one. As a result, you will have renewed focus and energy while tackling important tasks and maintain better mental health in your personal and professional lives.

4. Maintain a to-do list

If you have been a contractor for a long time, you may already be using a to-do list or a task management schedule to manage your deliverables. These to-do lists can aid in streamlining and managing your projects smoothly, thus optimizing your workload and productivity levels. Here’s what a task list could look like for an architect (read this post on project management tools for architects):

However, before proceeding, you must understand the importance of creating and maintaining a to-do list. To manage your to-do list effectively, you must break down large projects into smaller chunks (tasks), prioritize the time-sensitive and crucial tasks and projects first, and assign realistic deadlines and time blocks to each task or project.

Depending on your operational scale, you can utilize task management tools like Paymo or Todoist to help you organize and manage your projects more effectively.

5. Don’t overdo things

As a contractor, your livelihood and income depend entirely on the work you do within the billing duration. So, it is understandable if you are stretching yourself thin to get more work done. While it may feel good and even work for a while, you may quickly end up feeling overwhelmed or burned out if you are not careful.

To prevent this kind of situation, you must assess the scope of each project, prioritize the most crucial tasks in the project, and assign feasible deadlines to each of them so you can concentrate on the necessary ones without overdoing it. You can then avoid dealing with too many tasks simultaneously and still achieve objectives at a reasonable speed.

6. Utilize time blocks

Utilizing time blocks is a great way to manage your time and achieve higher productivity levels at work. You must consider dividing your typical work day into smaller blocks or designated durations to achieve certain predefined objectives and tasks so that you can stay focused on one important thing at a time.

Time blocks can prevent you from becoming overwhelmed and enable you to schedule proper breaks between tasks. These breaks can provide much-needed relaxation and rejuvenation before tackling the next challenge.

7. Generate regular timesheets and reports

What is the point of tracking your time if you are not fully utilizing the results you generate from the process? Assuming that you already prefer using a time-tracking tool over the manual method, consider generating regular timesheets based on the time you have tracked, thus reducing the chances of errors and enabling documentation and record-keeping.

Having said that, developing reporting capabilities and accessing detailed insights using your real-time tracking data is essential. You can also use these detailed reports to break down your schedule into smaller chunks based on clients, tasks, and projects to improve your billing accuracy and project success.

Concluding remarks

Tracking time is important for all professionals, even when employed somewhere, especially if you are a contractor. Whether you are an independent contractor or managing your team, you will have your hands full with work and managing resources. Tracking time will make this easier, provided you use the right tools and processes to automate and leverage it.