Build Your Team Episode 2: Financial Planner
Hey there creative. If you're not saving this amount of money every month, you are missing out. Let's get to it.
All right, everyone, my name is Sweet Deat and I'm so glad you found me on the interwebs! This particular post is a part of a series called Build Your team, which is all about creatives, building the people they need around them to succeed. So let's face it, we're creatives, we like to write things, create things, take pictures of things, whatever, and we need to be focused on that while we build a team of people that are around us to handle all the things that maybe we're not so good at. if you're just meeting me for the first time, my name is Sweet Deat, I'm a guitarist, I write music, I perform music for people, and I run a bunch of businesses that are around the music world. After 15 years in the biz, I'm starting this YouTube channel, and it's been a ton of fun, just talking about things that are I'm really passionate about, and that I feel like other creatives should be passionate about to really step up their careers.
Today’s Artist of the Day: Yob
To build your team is all about financial planning and finding a financial planner.
I've talked a little bit about in previous videos about why having a financial planner is super important, and I'm not gonna go into so many of those details, that video is called, and a very scary title at that, “your music career will suffer if you don't do this,” which is all about all sorts of different ways of financial planning and stuff, but today I'm gonna talk a little bit more about budgets, and I'm also gonna reinforce that with the idea of going and getting a financial planner, I don't care where you are in your walk of life right now, do it. Chances are, one of your friends already know someone that has one. We as creatives or really just about anyone in our world these days, lives beyond our means, the world tells us to buy by by finance, finance, finance, we're bombarded with it every single day, and as you know, when you're bearded with an idea, every single day, you end up giving in, we look around and we see our friend groups living a certain way at a certain status, and we feel like we need to be included as well. So what do we do? We go out, we rack up credit card debt, we go out to eat way more than what we should, we rack up tons of consumer debt, and the list goes on and on. All my friends, I'm here to tell you today, we have to break the cycle.
And unfortunately, the hard truth is, you have to stand up and be accountable for your own decisions, seriously, at the end of the day, it's your fault, you went to school, you racked up $80,000 or $100,000 worth of school debt upon celebrating your graduation, you went out and bought a brand new BMW, and then once you got settled, you went out and got approved for financing on a house that was $300,000 or something, seriously, all of these things are your fault. Now I'm gonna throw you a branch, your parents told you to do all this stuff probably right? They probably told you to go to college and get a degree because it was the best thing for you to do, they were given bad information and they pass it on to you, and that sucks, but ultimately, you made the decision to go to college yourself... Let's start with some personal ownership of where we stand right now as a community and individually, so if any of this is gonna work, you have to start with the fact that you made the decisions that you made, and now you have to live with those consequences. I know, I know. I'm sorry, this is heavy, I'm not trying to hurt you, swear, but this is why a financial planner is super, super important, coming to them and laying your life on the table for them to evaluate from a number's perspective is going to give you a way out of this this time, I wanna give a big shout out to my friend Bill.
Bill paid off over $60,000 of his debt by going to a financial planner, figuring out how to consolidate that, move things around and save money, and also attack that debt with as much money as he could every single month. He stayed focused on his dream of becoming debtfree, and after all these years, he finally did it, Bill as a bass player and a tuba player, and I know that he probably worked so hard in taking every give he could get that paid just about any kind of money that he could to put towards this fund, and I'm so proud of him, so... Dude, thumbs up to you. So any good financial planner worth their weight in salt as they say, they're probably gonna say, to pay off your debt first is fast and efficiently, and responsibility as you can... You obviously don't wanna be in the poor house eating ramen noodles every single night for years upon years to pay off a debt, it's not really a healthy and sustainable way mentally to accomplish this goal. Every case is different, and everybody's situation is different, so some planners may say, attack the debt and only do that, some planners may say, attack the debt, but also save a little at the same time, so that you can build stability and also pay down your debt. So a simple rule that I have followed for most of my musical life, I would say the latter side of it, the post 25 or so, has always been a simple little equation that I heard in passing along the way of life from people that were way smarter than me, and somehow it just stuck with me and resonated with me, and so I'm going to share that with you today. It's called the 5030 and 20 rule.
So the 50/30/20 rule. Let's talk about it.
The first number, 50 percent, that is your fixed monthly expenses, what I mean by that, like say the things that you absolutely have to have to survive. So a roof, food. We're talking about the things that are absolutely nonnegotiable, not things you want, but things that are nonnegotiable, that's where 50% of your income will likely go if you've been considering things that were not safe, fixed expenses that were in that category for you, and that it's higher than 50%. Maybe you wanna figure out how to work that number down to where it's closer to 50%. The second number, 30%, this is what you call discretionary income, like going out and having a drink with friends, or maybe a subscription to a website that fulfills you and keep you entertained. What I found in my own life is whenever I go through and sort of recalculate year to year on this 50/30/20 rule is that 30% is usually where my spending gets out of hand, I've got subscriptions over here, I've got subscriptions over there, and next thing I know, it really piles up, and most of them I'm probably not really using that much, so come through your budget, figure out what's that discretionary 30% income, and you'll probably be surprised how much you're spending that you don't need to be cutting out that alone will do so so much for the next percentage. 20% is what you should be saving. Now I know that's an aggressive number, and for you in the beginning, it may be completely impossible to start with 20%. Honestly, I've been through periods of times in my life where 20% was just not reasonable, it was more like 10% or 5%, but sometimes I may have a really big month and I can put a little extra to counterbalance those months where I didn't have a lot to give. That's also part of being a creative. Right, our money seems to come in in spurts, so if we can get ourselves on a fixed budget as much as possible, you're going to see longterm success in your portfolio, and you're going to be ready for things that come that you don't expect to hit you like Coronavirus, take a look at your own life, 50/30/20.
Maybe the answer is increasing the amount of work you do, and if that's the case, maybe you can look for a second job to supplement what maybe your creative passion is shortterm. It doesn't take a lot of time out of your day, but adds a few extra hundred dollars a month with the internet, these type of things have never been more possible. It's really quite incredible what people are willing to pay you for these days, and you'll see what I mean when you read the comments below.