The Most Important Personal Finance Tips For Musicians
Personal financial management isn’t something simple for everyone. This is true for every professional who don’t have financial management skills or training. If you are a musician and you need to know how to manage personal finances, this website provides you with best tips to do that. You should know that though personal financial management may be a hard thing, it’s possible when you know some important tips. Thus what you earn in what you do will be managed well to prevent cases where you may clear your bank account. It’s important for you to know how to manage your money as this will enable you to save a lot. Here are the right tips that you should learn.
Every time you earn money from your work, you should remember to follow the 50/30/20 rule. This is the ratio that guides how you should divide your money that you have earned. This is to mean that payment from a gig should be divided by using the ratio above to avoid money wastage. The 50% of your pay should take care of your needs that include rent, bills, and food. The second part, the 30%, refers to the amount that you will use on what you want. Such expenses will cover the money for new musical instrument, a video game, or even new clothes. The remaining 20% should be your savings. This is the money that will stay in your account should you have needs that will require you to touch your savings.
Every time you do a performance, you will be paid as a musician. Given that the money comes in day to day depending on when you do shows, you may find it difficult to see the bigger financial picture. Hence you should get to discover more on how to manage your finances well and avoid problems. You should use a spreadsheet now and create a budget. With a good spreadsheet you will be able to see well the amount of money that you will have to pay off for various bills. Every gig will have its pay and they all vary that such a spreadsheet will be very useful.
Every musician will make money that will vary every money. Some months come with huge pays and others will be low. Thus it’s important that you check well how you spend your money the months that you have earned a lot to ensure that you will cover for the months that you have earned less. Use the spreadsheet above and make sure that you have accounted well for the low months pay. Another way to ensure financial security is to be ahead on expenses always. This means that ensuring that you have money that can pay for your bills the following months even if you won’t have any work to do.