Whats Your Budget Funny Artist Life

Not every hobby needs to be a side hustle. But, if you set out to brand money off of yours – congratulations, you're running a business! Now you have to pay attention to finances.

Information technology can be uncomfortable taking something you do for fun and turning it into a product with a dollar value, especially if you're a artist. Add on the trope that being financially savvy is antithetical with being a true artist, and it'due south no wonder many creatives experience "bad with money."

Just when you lot ignore your finances, you're not merely missing out on peace of mind, yous're also losing the ability to make audio business decisions that come from a identify of clarity rather than an emotional "I'll accept what I can get" free energy.

Writer, illustrator and musician Paco de Leon runs a financial education firm and accounting bureau. Her volume, Finance for the People, is a beginner-friendly guide to navigating your fiscal life. De Leon joined Life Kit to offering her best money management tips for creatives.

Paco de Leon is a musician, author, illustrator, founder of The Hell Yeah Group and writer of Finance for the People. Left: Penguin Life; Right: Photograph by Jean Pablo hibernate caption

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Left: Penguin Life; Right: Photo by Jean Pablo

Set weekly finance time

Whether yous're following up on invoices, logging expenses, paying bills or researching accountants, many fiscal chores are forgotten if nosotros don't take fourth dimension to prioritize them. To avoid this, prepare up a weekly finance meeting with yourself and treat information technology every bit sacred. Spend anywhere from 20 minutes to an hour to check things off your listing, instead of just doing them when yous think.

"Don't allow people to book meetings or bother you during that time," says de Leon. "Having that space to focus will allow that function of your life to expand."

Separate your personal and professional finances

It's easy to neglect your finances if all your money is kept in the aforementioned account and your transactions aren't marked as personal or professional.

So, bank with your business in mind. Monitor your money and how it's being used by creating carve up checking and savings accounts for your personal and professional person finances. Budgeting for your business organisation becomes a lot easier when y'all have a articulate idea of what you're actually spending and earning.

At first, it might feel a niggling scary if there's no money flowing in. Simply, de Leon says, it can as well feel good to look at your stagnant accounts and ask, "How am I going to water this? How is this going to get fed?"

Don't forget taxes

Another reason for separating your professional and personal finances is it makes it easier for y'all to report your earnings to the IRS, which you're required to do, regardless of the amount you lot brand.

And, if you make more than $400 a year, y'all'll likely accept to pay both income tax and cocky-employment tax. To prepare for this, de Leon says to save anywhere from 10 to 30 percent of the money you earn and put it in your business savings account to prepare for tax season.

If preparing for taxes is scary or stressful, consider hiring an accountant! The U.S. revenue enhancement lawmaking is thousands of pages long and it changes often. Hiring someone to assist you navigate information technology can provide "a huge return on your investment in terms of how much it costs," says de Leon.

Know your market place

Here's a hard truth: Just considering you enjoy making photographs and your friends like them on Instagram doesn't mean your side by side step should be buying a domain name, producing hundreds of prints and setting upwards an online shop.

To better understand if there's need for what you offer, de Leon recommends asking yourself, "Whose problem am I solving?" Who is looking for what I do or make, and why?

From an creative perspective, information technology might experience strange to frame your work as a solution to a problem, says de Leon. Simply if you've decided to put your work in a commercial space, that question helps you consider who you are trying to reach, who is willing to buy your work and what they are willing to spend.

To demystify pricing, consider concrete and abstract costs

Pricing your products or setting your rates is like a "cactus bush," says de Leon. "It's prickly and hard to navigate."

Pricing requires y'all to consider concrete factors, like the cost of your materials and workspace, and abstract ones, like the value of your time, your level of experience, who you want to achieve and what you lot offer that no one else can.

If examining all of that sounds overwhelming, remember that pricing falls within a range. There'due south a low and high end for every service and product on the market. Inquire your peers or inquiry online to get a sense of what those limits are and afterward, reflect on where you want to be in that range and why.

It can feel simpler for beginners to add up all of the in a higher place and determine on an hourly rate. But, depending on what you're offering and the more experience you proceeds, setting a price based on overall value – the need you're filling or solution yous're providing for someone – is ultimately better for creators, says de Leon.

Know when to ask for help or raise your prices

If you are earning revenue from a skill or product, you might be doing a bunch of other things, too: sourcing, marketing, aircraft, bookkeeping.

Pay attention to the tasks that experience hard. What slows you down, burns you out, or takes upwardly time that you lot'd rather spend doing something else? It may be helpful to outsource this task.

And, if your time becomes more valuable...well, it just might be time to raise your prices and come across what happens.

The podcast portion of this story was produced by Sylvie Douglis.

Nosotros'd love to hear from you lot. If you accept a good life hack, leave u.s.a. a voicemail at 202-216-9823 or email us at LifeKit@npr.org . Your tip could announced in an upcoming episode.

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Source: https://www.npr.org/2022/02/03/1077923841/financial-advice-for-artists-who-think-theyre-bad-with-money

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