The Thriving Artist

Saving and Investing for Performers, Artists, and the Stage & Film Industries

David Maurice Sharp

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317611417
• Edition: 1
• Topic: Médias et arts de la scène
• Subtopic: Arts de la scène et monde des affaires

The old cliché about the "starving" artist may have a basis in reality, but it isn't set in stone! The Thriving Artist provides valuable advice for the performing artist, whether you're an actor, dancer, lighting guru, costumer, or stagehand, on investing, saving, and building a diversified and stable financial portfolio. Written specifically for artists who have fluctuating, uncertain, and sometimes limited streams of income, this book promotes an understanding of finances and the investment world for the artist by offering clear, basic explanations of how finances work and instruction on how to participate in them as an investor. It also provides unique strategies for integrating financial awareness and planning into your life as an artist, and how that can help to provide a better sense of financial security. With The Thriving Artist, author David Maurice Sharp guides you with unflappable good humor through the tricky financial waters that come with following your passion.

CHAPTER 1 Having Choices

DOI: 10.4324/9781315750194-3

Dancers—and especially modern dancers—are among the lowest-paid professionals in the country. Early in my career, I was cast in a production of Cabaret at Darien Dinner Theatre, playing Bobby, dancing in the chorus and understudying the Emcee. We were doing Ron Fields’ original choreography and had a ten-week run, so I had been having a blast, as well as a nice respite from the rigors of the modern dance world. As the production was nearing its end, I was starting to think about where the paychecks would be coming from next and what I could do to both earn money and have the flexibility in my schedule to audition and rehearse—the usual artist's dilemma. A friend of mine suggested that I meet with the temp agency that she had been working with, as it would allow me to choose the days that I wanted to work and would not entail jobs that would be physically draining, like restaurant work. I figured that I had nothing to lose, so I met with the agency recruiter.

They asked me to go on an interview the next day, as they had a client that wanted some long-term temps, but who insisted on interviewing potential candidates before bringing any on board. Armed with almost no information about what they were looking for, I found myself seated (in a suit and tie, at least, not in an insect costume) in front of a very business-like woman whose first question—after reviewing my almost exclusively arts-related work experience—was, “So do you know anything about Wall Street or the financial markets?” I was honest. “No, but I can learn.” Her next question floored me. “Ok, so tell me about this production of Cabaret that you just finished doing. How was it?” We proceeded to talk about other performance work that I had done, my aspirations as a dancer, and other topics that had absolutely nothing to do with the financial markets or any other business-related area. By the time I got home, rather baffled by the direction this interview had gone in, I have to admit, I had a message from the temp agency saying that they wanted me to start the next day. The job was essentially in a call center, contacting shareholders (I would soon learn what those were) to make sure that they had received their proxy materials (next on the list of learned topics) and to encourage them to vote their shares at the annual meeting (once I figured out the previous two, this followed pretty logically).

Before long, they tasked me with tabulating the votes for contested corporate elections, which are known as proxy fights. These transactions often determined who took control of a company, so this could involve any and all strategies that would help your side win. They included combative sounding things like a “war room,” which was the room used the morning of the meeting to receive faxed votes (this was still pre-pdf times), phone calls, etc. The location of the war room was always a closely guarded secret, to ensure that the opposing side would not attempt any type of sabotage. It was also the place where all of the voting materials were assembled before being given to the inspector of election. So as the person in charge of the tabulation, I started being asked to attend these meetings. I would keep all of the voting materials with me at all times, in a litigator bag that we jokingly called the “football” (named after the president's case of nuclear launch codes which always travels with him), and was responsible for turning them over to the inspector of election once the meeting had commenced. It wasn't unusual for the firm to charter a private jet to go to these meetings, since you could never check the bags that the votes were in, for fear of them being lost. So I quickly found myself feeling like I was in a real-life espionage thriller. The temp agency was not too keen on having one of their temps being flown all around the country, however, so the firm asked me if I was interested in being hired by them directly. I declined, since I was still pursuing my dance career, but they countered with an amazing offer: They would accept my working 20 hours a week, whenever I could fit it in, as long as they were my only job priority outside of the arts world. I could still audition, take classes, rehearse, perform, and go on tour, and I would receive a salary and benefits. Wow! I said yes, and ended up being there for 13 years, all the while pursuing and furthering my performing career.

This led to me learning about the basic concepts of investing, and had me following the stock market and other investment vehicles in a way that I never had before. Also at this time, mutual funds were becoming increasingly popular, and pensions were being phased out in favor of 401(k)s, 403(b)s, and IRAs. Investing was becoming not just something that the “big boys” did, but something that was more and more available to everyone, as well as something that everyone had to become at least somewhat familiar with. The responsibility for saving for retirement and having financial security in your retirement years was shifting from the companies to the workers themselves.

I started getting calls from friends asking if I could answer some questions they had about investing and the marketplace. They were interested in possibly buying into some mutual funds or stocks, and felt like when they called the companies offering these products, they weren't being taken too seriously due to their lack of knowledge and their comparatively low amount of capital to invest. They were hoping that since I had a job on Wall Street, I might be able to help them understand what they were looking at, without the condescending attitude and judgment they felt they were getting from the industry “professionals.” I was more than happy to help. This was also the time that investment clubs were coming into the spotlight, thanks in part to the publication of The Beardstown Ladies’ Common-Sense Investment Guide, a popular book that sparked increased awareness and interest in investment clubs. I invited some of my investment-curious friends—who in turn invited a few of their friends—to get together to discuss forming an investment club for artists.

All this led to the creation of the Thriving Artists Investment Club, an investment group for artists that existed for over nine years (we eventually voted to dissolve the group and distribute the profits at a time that seemed most advantageous for us). The main objective of the club was educational—helping every member to become more comfortable with the financial world and their ability to participate in it. Of course we were also hoping to make some money! We had dues of only $25 a month, making it very affordable for everyone, which were pooled into the club account. Investment possibilities were presented by members, analyzed, discussed, and finally voted on. And we did really well! Founding members who had contributed about $2,800 over the years received back over $4,000 when the club disbanded.

So what did that mean? It meant, for me at least, that not only are artists more than capable of navigating in the financial markets, they are primed to excel at it. Our ability to think outside the box and to not be afraid to explore counter-intuitive ideas are some of our greatest strengths. In an area like the financial community, where “herd mentality”—or everyone thinking and reacting the same way—is the modus operandi, this becomes a huge asset. Indeed, one of our favorite club mottos was “When there is blood in the streets—buy!” This meant that when everyone else was freaking out and selling everything, we were looking for bargains to add to our portfolio. Artists also have the discipline to be tenacious and understand that to get to the long-term goal, we may have to take small, steady steps. After all, why do you do your dance warm-ups, your musical scales, or your vocal exercises? Because you understand that by doing them consistently over the long term, it will make you better at your craft. That same principal holds true for your finances.

What would it do for you, as an artist, to take control of your finances and start having them work for you instead of the other way around? It would help you to achieve some peace of mind, no doubt. Not having to worry about where this month's rent money will be coming from or what you are going to do about retirement would certainly ease your mind. Then you can concern yourself with things that better deserve your time and attention. Most importantly for me, however, was the freedom of choice that it provided to do the projects that I wanted to do, rather than having to choose projects just for the money. I was able to work with some amazing choreographers in the modern dance world, such as Anna Sokolow, Rachel Lampert, Mimi Garrard, Lucinda Childs, Heidi Latsky, and Sean Curran. I could learn many of their signature pieces without worrying about how much I was going to earn by doing it. The fact that I had taken control of my finances and had been investing was not the only factor that allowed me to do this. It was also due, in part, to the non-industry-related work I had that we are all faced with doing at one time or another. Indeed, we all know that being a caterer/waiter, doing retail or restaurant work, or myriad other bread-and-butter jobs, is usually a component of our lives sometimes. But the combination of my Wall Street job and taking responsibility for my finances by investing and building a diversified portfolio gave me the luxury of choice in my chosen art. We also face, on many occasions, the choice of whether or not to do pro bono work that would be important creatively to us. Having control of your finances will help focus those decisions on the artistic aspect. The times that I did take a well-paying commercial shoot or musical theatre gig outside of the modern dance world helped further my pursuit of financial independence, in addition to expanding my creative horizons. They were choices that I was able to make—doing the things that I found the most artistically fulfilling at that time—rather than finding jobs based on the financial remuneration they would provide.

CHAPTER 2 Six Basic Financial Habits

DOI: 10.4324/9781315750194-4

Before we dive into the details of specific investments, let's set the stage for the betterment of your finances by identifying some financial habits for you to consider adopting. Incorporating them into your life will lay the groundwork for a sensible action plan for your financial well-being. Your six basic financial habits to consider are:

1. Start to save
2. Escape from the feast-or-famine mentality
3. Control your debt
4. Diversify your investments
5. Maintain a long-term strategy
6. Track your progress

We'll get into each of these habits in much greater detail, but I first want to define a general parameter. Following my suggestions should never require you to spend a huge amount of time. If you start putting in too many hours to whip your financial status into shape, it will become onerous and dissatisfying and you'll stop doing it. Set up your strategy for improving your finances in such a way that it is easy and quick. Add the components gradually if you need to, so that they become just another aspect of your life. On the other hand, don't expect to not have to put any time or effort into it at all. Inevitably in one of the workshops that I teach, there will be an attendee who says, “I want to be financially independent, but I don't want to have to do anything.” Don't we all! But that is not realistic and not what this is about. This is about you taking responsibility yourself for your own financial well-being. Will you need some help at different points along the way? Of course, and there is no shame in that. Yes, it will take some work on your part and it will require adapting some new habits. But it will become a rewarding part of your life if you stick to it, and not one that in any way should overwhelm you or cause you to spend an inordinate amount of time doing it. Now let's delve into the details of the financial habits and determine how to incorporate them into your life.

Habit #1—Start to Save

Getting into the saving habit is one of the first crucial steps to taking control of your finances. As with how much time you spend on your finances, don't set unrealistically high demands on yourself for saving. If you do, you'll get discouraged and give up. This is not what we want at all. If you aren't currently saving anything, try starting with $5 a month. This may seem like nothing, but you are trying to create the habit of saving, without incurring what feels like a heavy burden. Skip buying that take-out coffee one morning or pack a lunch instead of buying it one day, and you're already there. Once a few months have gone by and you realize that $5 is easy to put aside, increase it to $6 or $10. Keep this up and you're well on your way to having some investable cash. For those of you who are already saving—well done! Now find a way to start bumping it up a little. Pretty soon, this money you are saving will become just like paying any other bill each month, except that the payment will be an investment in you, rather than for your mobile phone service or your electricity.

Habit #2—Escape from the Feast-or-Famine Mentality

One of the hardest things for an artist to tame is the feast-or-famine mentality, and we've all been there. When you have a well-paying gig, you may be tempted to spend like there's no tomorrow. All of those things that you have deprived yourself of during the low-income times suddenly are within your grasp, so why deny yourself any of them? Besides, you know that just around the corner could be another lean time when you won't get to have it all. So why not splurge now? Have dinners out at those great restaurants you've always wanted to go to … buy those new clothes that you don't really need … take that exotic trip that you've always wanted to take. You may never have the chance to do these things again, right? It is definitely the common trap in which freelancers with fluctuating and unpredictable income can get caught.

But you can tame the beast. Start by figuring out what it costs you to get through a month, based on what your typical expenses are. We will refer to this as your “monthly nut.” Here are some categories to get you started:

• Rent, mortgage payment, and/or maintenance charges
• Utility costs: electricity, phone, cable TV, heating, water, Internet. Calculate out the average monthly cost over a year, as they could vary from month to month, especially for things like electricity and heat. Many utility companies offer plans that allow you to pay a fixed amount each month, which is based on your average usage. If you think that this c...