Managing your music career finances might be the least exciting part of the business journey, but it's the core element that divides a professional from an amateur. Money makes the world go 'round and it's the fuel for your music machine, too!
But just because the task seems daunting doesn't mean that it has to be hard. The team at Artist Collective has made it easy for you, with Music Business Budget Templates available for download! All you have to do is become a member of Artist Collective on ArtistCollect.com
Login to your Dashboard and click 'Using a Budget to Build a Full-Time Music Career'. If you scroll down to Module 2, you'll see a LIVE Budget Walkthrough with Tere Wang and Vinnie Hines. In this video, you'll watch as a real finance coach analyzes and tracks the expenses of the typical twenty-something musician.
This budget walkthrough identifies all expenses under the same umbrella. This means that your lifestyle expenses and business expenses are on the same document. It would seem that very few musicians think this way. They typically set segregate their money and spending between their love of music and their lifestyle, but if you want to make it in this industry, every dollar you spend needs to be productive and measured.
So while you begin to download the templates from our website, I want to give you some tips to make your music budget a little easier.
#1 - Always round up.
A simple trick to make sure you always have more money than you intended is to use conservative estimates on whatever financial figures you track. For example, if you have an expense that is regularly $17.50/mo, round it up to $20/mo. The leftover funds can be considered petty cash.
Also, if you have fluctuating costs like utilities dependent on the season, pick the month it was highest and use that figure. It's always better to be above the green line than below when the year's end comes.
#2 - Combine business goals with lifestyle expenses wherever possible.
The division between business expenses and personal finances almost disappears once you become self-employed, so it's key to combine expenses wherever possible. For those working towards full-time music careers, it's key to make sure that things like housing, vehicles, and entertainment costs are worthwhile in as many ways as possible. Your choices could save you thousands as your career progresses further.
Let me give you some examples of how you can cut costs:
-Travel costs can seem small but they pile up with time. An easy way that I've budgeted smarter considering the selection of my home was based on its location. I databased the local music venues that I was suited for and prioritized those that I already played, giving priority to those that paid better. So, I knew I had 3 gigs/mo in one city totaling $800 profit and only 1 gig/mo in another that paid $200. It was an easy choice to live in the city with more opportunity, but I made sure to live on the outskirts of that city headed towards the other. The gas costs I saved by make the conscious choice saved me $500 in gas over the course of a year.
-Another tip I recommend for the sake of content, affordability, and productivity is living with your music team, bandmates, etc if at all possible. There's nothing quite as team building as living under the same roof and if you and your team are on the same page, doubling down your efforts on the same lease can be a great way to go!
-If you intend to tour in the next few years, I highly recommend in investing in a vehicle that can handle that. The more money-saving features, the better. You'll need room for gear, food storage, camping materials, teammates, etc. Also, dependability on the road will be everything if you plan a tour, so be sure to purchase smart and then include tow assistance in your insurance. I personally have chosen a Sprinter Van as my daily driver, saving me thousands in hotel costs over the course of my career! For those wanting to make the jump to full-timer, drastic financial decisions like that can be make or break.
-Perhaps the biggest costs I see clients come to me with are discretionary entertainment expenses. Bars, restaurants, etc are an easy way to blow your entire budget. Now I would never tell a client to completely cut out that expense, as networking, supporting local business, and staying inspired is key to having a long career. However, take a hard look at WHERE you're spending that money and you may find that simply changing your destination can change your career. For example, if you're going out to dinner with friends, choosing a restaurant or venue that is involved in live music would likely be the most productive choice. It gives you an opportunity to be seen actually supporting the businesses and community that you're trying to be a part of. You can score info from servers, bartenders, door guys, etc and maybe even ask to chat with MGMT or inquire about booking after the check comes. At this point in my career, it's rare that I spend a single dollar somewhere that doesn't directly support the music business and I urge you to do the same for the sake of your career and industry as a whole.
#3 - Take the most time on your music business budget.
I urge readers to be as concise and detailed regarding their music business category (on our downloadable templates, of course) more than any other category. Itemize every single career-related expense you've had and then check that sucker three more times. Some simple expenses I see folks neglect are:
-Instrument Maintenance Costs (Strings, Cleaners, Tools, Services)
-Gear Purchases (Cables, Instruments, PA/Speakers)
-Website Fees (Hosting, Domain, Merch Stores, Dropshipping)
The list could go on forever depending on your corner in the industry, but the truth remains the same: in order to be looked at legitimately in this business, you have to make music money. And mark down the expenses you WANT to have as your career grows. Examples include larger marketing budgets, distribution costs, future studio time, etc. Plan for your success and it'll be closer than you think.
#4 - Audit your budget quarterly.
Things change, careers grow and expenses increase with more revenue. It's key to schedule a quarterly budget audit. My 2020 budget is WILDLY different than my 2019 budget for obvious reasons, but make sure you do this at least every 3-5 months. Also, a small pro-tip is to involve someone close to you to audit your budget after you've made it. Sometimes we're purely too close to our finances to see our actual spending for what it is. You may say you spend $300/mo in restaurants, but your friends, partners, etc might have an estimate for you closer to $600/mo just based on your conversations and what they know about you. A second opinion might polish your budget in a way you couldn't.
So now it's time for you to go do it! Go download the templates, start plugging in numbers, have a friend/family member audit that thing, and start building your music career on intentional financial management!
PS: Stay tuned for Part 3 of this Series - How To Manage Your Music Career Finances! And in the meantime, be sure to log into your AC Membership to stay current with Using A Budget to Build A Full-Time Music Industry.
Connect with the author, Vinnie Hines AKA @ac_vinnie today!
EMAIL: [email protected]
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