Financial Management Top 12 for artists
1 – Do not get in debt
– Pay off our debt
– Collect interest, don’t pay interest
– Not paying interest is the fastest way of saving money
2 – Live below your means
– That’s the only way to get ahead financially
– Otherwise we’re living day to day
3 – Learn to save, not to spend
-Constant growth taught us how to spend
– Continued recession is teaching us how to save
4 – Know the difference between assets and liability
– Assets generate income.
– Liabilities cost us money
5 – Calculate your net worth
– It’s everything your own minus everything your owe
6 – Invest, don’t speculate
– Investing is knowing we will get a return on our money
– Speculating is hoping for the best outcome
7 – Diversify your investments
– Don’t put all your eggs in the same basket. One fall and they’re all gone.
– Instead, diversify so that if something happens you don’t lose everything.
8 – If you run a business, do not reinvest everything in it
– Artist-based businesses have no resale value
– That’s because the value of the business is us. If we are gone, the value is gone.
– We must re-invest outside of the business in things that have resale value.
9 – Do not expect fame, or ‘being discovered’ to bring you wealth
– Instead, take the necessary steps to build up your net worth now
– Wealth is rarely acquired all at once.
– For most of us it is an gradual process, not a jackpot.
10 – Work towards generating residual income
– This means generating income that is not tied to your time
– There is a limit to how many hours a day you can work.
– But there is no limit to how much you can make through residual income
11 – What matters is how much you keep, not how much you make
– Who cares if you make millions if you keep none of it
– Lowering your expenses is the most effective way of increasing what you keep
11 – Plan ahead
– Hard work and long hours are not enough to generate financial wealth
– You have to have an organized plan
12 – Manage your finances yourself
– Don’t take a chance by having others manage your money for you
– It’s ok to have financial advisors
– But its not OK to let them take decisions for you
– We are the one that cares the most about our financial well being.
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