Construction contingency is the financial buffer that keeps your project alive when the unexpected hits. This episode breaks down what contingency means in construction, the different types every project team member carries, and how contingency percentages change across project phases.

You'll learn the critical difference between a contingency and an allowance, why owners, architects, and contractors all need their own reserves, and the golden rule that determines how much contingency your project actually needs. We also cover hard cost vs soft cost contingency and a real story about doing a cost estimate in 20 minutes for a politician.

📝 Key topics covered:

• Construction contingency types: owner, design, contractor, subcontractor

• Construction contingency percentage by project phase

• Contingency vs allowance in construction budgeting

• Hard cost contingency vs soft cost contingency

• How to determine the right contingency for your project

• Construction contingency and the ARE exam

⏱️ Chapters:

(0:00) Introduction

(0:13) Why Something Always Goes Wrong

(2:29) What Is a Contingency

(4:34) How to Plan for the Unknown

(6:50) Who Carries the Contingency

(8:19) How Much Contingency Is Enough

(10:14) Final Thoughts and Takeaways

📖 Read the full blog post

📝 Download the FREE Construction Contingency study notes

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📚 Individual ARE Exam Courses:

• PcM 101 (Practice Management)

• PjM 101 (Project Management)

• CE 101 (Construction and Evaluation)

• PA 101 (Programming and Analysis)

• PPD 101 (Project Planning and Design)

• PDD 101 (Construction Documents and Specs)

• AIA Contracts 101

• Building Codes 101

• Mechanical Systems 101