More often than not actors are professionally unemployed. Even incredibly successful ones! When an actor does work, it’s usually for a determined or limited amount of time, meaning you get the job, you do the job, and when the job is finished you’re back out looking for the next job. With the exception of landing a series or contract gig, this repetitive cycle is usually the case for most working artists again and again. So, what’s this mean? Financial inconsistency!
In this whirlwind of inconsistent income-earning, and especially when you’re just starting out and launching your career, it’s important to safeguard your financial stability. Here are eight ways you can do that.
1. Don’t overspend.
Know what you can afford and don’t spend what you don’t have. Think of your credit card (if you have one) not as a credit card but more as a convenient card. Don’t use it for borrowing money you don’t have. Use it knowing that you’ll be paying off your bill in full every month with the money you do have...period! No rolling over!
2. Live beneath your means.
Don’t spend more than what you’re making and live as though you’re making less than you actually make. Doing so will not only allow you to save but also invest (see seven and eight below). And when lean times hit, which they will, your lifestyle won’t be shaken so easily.
3. Set financial goals both long and short.
Make lists of significant things that are important to you and will require time to obtain. You should make shortlists (weeks and months) as well as long term (a year to several years). This will help keep you from foolish spending; purchasing things of little value to you.
4. Record what you’re spending money on.
Keeping a record of what you owe and spend each month will hold you financially accountable. In the business world, actors are considered solopreneurs, which are business owners who run their business alone, for themselves. Actors are the president of their own show business. All working actors are in business. Some run their businesses successfully while others don’t. Refusing to think of yourself as a business owner only helps to ensure business failure.
5. Partition your earnings.
Once you begin recording what you spend, start charting your spending. Create a pie chart, like a sliced-up pizza. You can create your own graphics or use a professional app like Mint. Make bigger sections for what you’re spending most of your money on (rent or a car payment) and smaller sections for the little purchases. This imagery of your spending will have a powerful effect on you as your spending habits become visually tangible.
6. Stay in flow.
Money must move! Money that moves has more power than money that’s stashed. Money is often equated to water: cash flow, liquid currency, slush fund, money pouring in, etc. Like fresh, healthy water, you want to keep things moving. However, control must be exercised with the volume and direction of flow. Keep more funds coming in than going out and balance the direction of those funds toward spending, saving, investing, and giving. Yes, giving! Benevolent giving is a key strategy for creating wealth. That’s another topic for a future article.
7. Save money.
Pay yourself! I know it’s difficult, if not impossible, to think about saving money when you’re fighting to pay your rent. However, it’s imperative that you pay yourself first! Before anything else, take a minimum of 5%, if you can 10%, and put that away for yourself consistently. If you don’t create a habit of paying yourself first, you’ll continue to pay everybody else except you! Life will move on and you’ll stay in the same financial place.
8. Invest money.
Investing is not just for the rich or professional investor types. Investing is for everyone! Like anything else that may be foreign to you at first, it’s just a matter of acquiring a little knowledge and the mystique disappears. Investing is simply a matter of taking a percentage of your income that would have been placed in savings and directing it into areas that will pay you a bigger return than a savings account can. There are endless areas in which you can invest. Just begin looking around and asking questions. In no time at all, you’re sure to surprise yourself with what you’ll learn. You can start small and safe with minimal risk. Once you experience how your money can begin working for you by making you even more money, you’ll be hooked!
This brief article is by no means the bible of money management, but it’s a strong foundation and a solid beginning for actors just starting out. Apply discipline and you’ll be on your way to financial freedom, regardless of what you do or don’t earn!
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