When beginning a career in music, one of the main issues that many artists face is the ability to manage and maintain their finances. Indeed, with so much on their plate, balancing creative endeavors with money management can be difficult for many musicians.
To avoid getting into a troubling situation and ending up broke, it is vital that you learn the art of handling your finances from the start. This means creating a plan, staying disciplined, and sticking to a strict budget. For your ease, we have listed down a few tips on how to manage your finances as a struggling artist.
1. Know your net worth
The first step to sound financial management is understanding your net worth. This means calculating the total value of all your assets including your property, savings, investments and insurance.
Next, you must subtract your debt and other liabilities from this number to obtain the right figure. Knowing your net worth allows you to plan your finances more effectively and make better decisions about spending and saving.
2. Set realistic goals
Financial stability doesn’t come overnight – rather, to become fully secure, you need to put in years of dedication and effort. When it comes to financial planning, it is important to set small, realistic goals. This will help keep you motivated and on track toward achieving your objectives. Make sure to break down your goals into more manageable steps that you can realistically achieve.
3. Create a budget and stick to it
Money without financial intelligence and planning is money soon gone. One of the most significant aspects of financial management is creating and sticking to a budget. Determine how much money you need to cover your essential expenses such as rent, food, transportation, etc. Then, see how much is left over for non-essential items such as entertainment and clothes.
4. Invest in yourself
Remember that you are your best investment. Any money you invest in growing yourself is money that’ll come back double. This includes taking courses and learning new skills that can help you advance in your career. It can also mean investing in your health by eating well and exercising regularly.
5. Create a savings plan
Life is unpredictable, and no matter how much you plan, hurdles are bound to arise. As an artist, it is vital that you create a savings plan so that you always have a cushion to fall back on during times of distress. This extra money can help you cope with unexpected expenses or financial emergencies. Try to save at least 3-6 months’ worth of living expenses so that you’re always at peace knowing you’re financially secure.
6. Invest money wisely
Investments, although risky, can be a great way to grow and secure your wealth. However, before you make your decision, it is essential to educate yourself and get a better understanding of the risks involved. Remember that there is no such thing as a guaranteed return on investment, so always be prepared for the possibility of losing money.
7. Protect yourself with insurance
There are different types of insurance that can help protect you financially in case of an accident or unforeseen event. This includes health insurance, life insurance, disability insurance, etc. Make sure to shop around and compare rates before choosing a policy.
Managing finances can truly be challenging amidst the pressures of surviving in the music industry. However, the above-mentioned tips, if followed consistently, can surely help you get on the right track.
This article aims to help struggling artists manage their finances in the best way possible. By knowing their net worth, planning their budget, saving efficiently, and investing wisely, artists can grow professionally and financially.
Eric Dalius is The Executive Chairman of MuzicSwipe, a music and content discovery platform designed to maximize artist discovery and optimize fan relationships. Eric is also the host of weekly podcast “FULLSPEED” which is a podcast that features interviews with groundbreaking entrepreneurs from a variety of industries.Eric is also the founder of “Eric Dalius Foundation” where he has created 4 scholarships for US based students. Follow Eric on Twitter,Facebook,LinkedIn,Instagram & also on Entrepreneur.com