When you ask an artist why they create art, they usually don’t say “because of the money.” Let’s face it, there are some opportunities for art to make big bucks, but in order to be racking it in, you have to be at the top (and getting there is a highly competitive, strenuous, and sometimes soul-retching journey).
Majority of artists make art because it makes them happy. But artists have to eat too. That’s why I put together some simple tips for artists to have the right money mindset and start strategizing on filling their bank accounts.
When thinking about how to make art and pay your bills, these are my tips:
1. Define Success for Yourself
Success for artists is different. It’s not about how big your quarterly bonus is or the money you’ve saved up to finally buy that vacation home. And it’s definitely not about working a 9-5 everyday to retire one day. Success for artists is the ability to keep making art. As long as you can continue to do what you love, you’re successful.
Success is going to be different for every artist. It’s important to get clear on what it means to you early on. Is it how much art you create? Which institutions show your art? How much your art goes for? No matter how you want to measure it (and there’s tons of possibilities), put some thought into this. That way you’re not stuck in the trap of always comparing yourself based on other’s judgements of success.
2. Value Your Work
This means calculating how much your time, energy, and resources are worth and being able to put a monetary value to your work. A consultant has an hourly rate, a freelancer has a going rate per project, and an editor gets paid on the number of words they write – you should have a simple way of calculating your worth too.
Here’s some things to consider when calculating your monetary value:
Billable time: Know how many hours it takes you to complete a work of art.
Purchases connected to making artwork: This includes all supplies, travel, photo rights (if you need these), and any other expenditures you have to complete the art project
Overhead: Overhead costs are any regular costs that don’t directly relate to the product or service you’re providing. Most businesses calculate overhead costs on a monthly basis. For example, if it takes you one month to create an art piece, then you can divide your costs (your wifi, electricity, heat in your studio, mortgage, insurance, etc.) by 12 and that’s your monthly overhead cost for the artwork (or divide that by how many pieces of art you created that month to get the exact overhead cost per artwork)
Profit: One thing you should consider when calculating your profits is your talent and level of expertise, and what true value this brings to a customer (rather than the cost of the product or historical costs). This is often called “value-based pricing.”
Market considerations: Think if there’s a lot of demand for your work and create your base price on this. It’s important to be strategic, for instance if there’s not a lot of demand then it might not be such a good idea to charge a high price. Also, keep in mind economic slumps and market conditions, it’s good to know what’s going on in the world so your price is relevant with the times.
If you’re just starting out your career in the creative sector, here are some beginner’s tips.
Next time someone is commissioning your art and is asking too little, you know to say no and show the math for how much a project will cost.
Pay in the art world is already a race to the cheapest – so when you say no to a job that would cost you more money to perform than it’s worth, SAY NO. Saying no to a ridiculously low rate actually helps out the arts sector, it gives artists the leverage to say “nobody will do it for that cheap, you need to scan through your budget again.” – Amy Scheidegger
3. Have a financial plan
This might be intimating and too big of a task to dive into, but it’s imperative to your well-being as an artist. In order to break this down and not make it as scary, start with planning out your next year financially.
Here are some things to consider:
1. Gross annual income
2. Paying out any debt
3. Health insurance
Here is a loose formula you can use to start thinking about your hourly rate:
annual salary + annual expenses + annual profit ÷ annual billable work hours = your basic hourly rate.
Calculating this is important if you’re looking at being hired or a freelancer for any projects.
Getting your finances in order can be a gruesome task, but the more thought you put into it now and value your work, the better financial standing you will have to keep doing what you love: making art.
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Artists, creatives, and freelancer – what are your best practices for financial planning? Let your fellow artists know by sharing your tips below: