I have always been a worrier when it comes to money. Blame it on my practical Midwestern upbringing. Or my Father. Or the fact that I’ve chosen writing musicals as my ironclad fall-back career in case acting doesn’t work out.
Thankfully, I’ve been extremely lucky to make my living as an artist. I say “artist” because it encompasses the various roles that I play in my work. Sometimes I’m an actor, sometimes I’m a writer, sometimes I’m a musician or a teacher. But it all stems from my passion for and abilities as an artist.
It’s only been recently, though, that I’ve had to actually sit down and think about what to do with the money I’ve made.
Shortly after college, I found myself with a big chunk of credit card debt. And because of the piecemeal nature of making money as an artist, I had no real system to keep track of how much I was making and how much I was spending. Never mind saving or investing!
That’s when I had to get smart about my money.I’ll share my process for getting out of debt and getting on top of my money, and then I’ll link to this really great post from acting guru Dallas Travers on the topic of funding your acting. It’s different from my more traditional approach, but it has great value in my opinion.
So back to being in debt, not being able to track my money, and stressing constantly about how I was going to pay my rent.
They say (the mysterious “they” who know everything about everything) that before you can create a budget, you first need to start tracking your money. That is – before you can tell yourself how much you’re going to spend on what, you need to start tracking your natural habits. From there you can create change.
So I downloaded a very #BASIC app called (duh) Budget. And I mean veeeerrry basic. I’m sure there are better, more sophisticated ones now, but I wanted something easy to use and not very frilly.
I created a couple categories (Rent, Groceries, Gas, Coffee, etc.) and began tracking my spending. By the end of two or three months, I was able to see how much I was spending on what.
For example, I spend a LOT of money on Groceries. Because I love to cook at home, and I’m addicted to Whole Foods. I also spent more money on Coffee than I probably should. So now I was able to make some conscious decisions about my spending and create a budget.
Using the app, I was able to set my grocery budget at $300 a month (let’s say) and my coffee budget at $60 a month. The groceries was based on my actual spending, and the coffee was based on my goal spending. Now I could keep track of how I was doing month to month. Voila – a budget was born.
Now – as far as my earnings each month, this is where it gets a little unique. Again because as an artist I don’t make a regular paycheck week to week, I had to do some figuring out as to how my budget was going to work within my monthly income. I realized after a few months that while I always had the money I needed by the end of the month, I didn’t always have it in the middle of the month when I needed to pay my phone bill, let’s say. This caused an unnecessary strain on my bank account, which would charge me a fee if I overdrew.
So I researched a credit card and opened it up with this system in mind: I would pay everything with the credit card while the money in my bank account filled up. By the end of the month, when I needed to pay off the card, all the money would be in there and so I could easily pay it off. Meanwhile, because my bank account was more regularly filled with money, I was able to begin accruing interest as well, creating more of a buffer.
I also made it a point to input my income AFTER I’d paid my agent and myself 10%. So the monthly income I had was based on REAL money, and didn’t include the money I’d set aside specifically for savings or commission.
That’s the basic system I’ve created for myself and it has worked MARVELOUSLY for me over the last five years.
Now, check out this great post from Dallas Travers on how to fund your acting career. It’s an awesome tip for those who might otherwise leave the biz because of money fear.
Feel free to share your artist-money tips with me! I’m always open to better ideas!
Great post! A few years ago I started to use Mint, which tracks all your spending and shows you pretty charts and graphs of your spending, particularly in relation to your income. Just by sheer fact that all my spending was being tracked by this unforgiving system immediately got me to spend much less. Accountability was a huge factor in getting myself on track financially. Artists should be even more financially savvy than people who make regular paychecks, because we have far less wiggle room when everything is eventually averaged out over the month, the quarter, the fiscal year, etc.
You’re SO RIGHT about artists needing to be even more financially savvy. And yes – the accountability factor was extremely helpful when it came to getting me on track, too. Great points! 🙂
I have what I call my make or break number that covers the cost of my monthly essential needs (includingany debt pay off and savings, as those need to be as non-negotiable as rent) and my priority number, which includes things I consider a priority like my career. I have to commit to earnings the make or break number every month. Even if it means picking up more gigs. I then use my previous months’ income to budget for the following month. If I’ve earned above my priority point, I can spend on my priorities as well. And if there’s a surplus, I have a choice to make between additional savings and fun. The biggest game changer for me was definitely earning more. Ditching the starving artist stereotype and thinking about how I could tell stories in arenas with more demand and bigger paydays. It’s been life changing. A bit more on the budgeting system – https://stefanieoconnell.com/budget-without-a-budget/
Really great system, Stefanie. Thank you for your comment! I want to spotlight the notion of how setting these numbers up allows you to make clear and intentional choices in your career and work. Sometimes we take gigs simply for the payday. But if having the money now means freedom tomorrow, I think there’s value to that. To paraphrase what you said, there’s no prerequisite requirement for an artist to starve before she can be called an artist.