Artistic: Don't depart your monetary future to likelihood
Are you just as careful with your own finances as you are with a client's budget or your agency's cash flow? If you view the financial side of your day-to-day job as a necessary evil, you may lack the motivation to think beyond the next few months or years when it comes to your personal affairs – no matter the next few decades.
“Usually, creative people don't start their careers to get rich,” reflects Silas Amos, a designer and design strategist with more than three decades of industry experience. “This is all very good for young idealists, but as the years go by and personal and family responsibilities increase, attention must be paid to the 'real world'. We used to be called “commercial artists”. The trading part shouldn't be an afterthought. "
"The past year has taught us that life is unpredictable," said Gary Morris, principal at Morris Powell Financial Management and a member of the Design Business Association's expert panel. "Although we cannot control everything, we can take steps to be as prepared as possible when challenges arise."
Think about the position you would like to be in when you stop working. Ask, "Where do I want to be at the end of my career?"
Morris Powell specializes in financial advisory to the creative sector, and Morris has seen firsthand how reluctant some creatives can be when planning long-term personal finances.
According to Morris, taking a few minutes to consider your longer-term priorities – and what you want to protect is a useful starting point. "In a world where so much feels out of your control, it is extremely important to act decisively and be in control of your finances," he says. "It gives you the foundation to build a solid financial plan and sleep much better."
Start at the finish line
Only when you have a clear picture of your goal can you make plans. "Think about the position you would like to be in when you quit," advises Morris. "Ask," Where do I want to be at the end of my career? "Then think about what retirement looks like for you, how much it will cost, and whether these goals are in line with each other."
One of Morris Powell's clients is Paul Taylor, Chief Creative Officer at BrandOpus. "Make yourself sit down and see what the next 10 to 15 years could be like for you financially, both in terms of need and want," was Taylor's advice. “Then commit to a plan that will help you achieve those goals. Yes, the plan will change and evolve over time, but at least you've drawn a line in the sand. "
A busy work life, especially if you are considering a young family, can take up all of your time and leave little room for future planning
Taylor has a 10-year plan that he reviews annually. "Trying to plan so far in advance may seem like a futile exercise – it's so difficult to predict what might happen when – but it forces you to ponder what financial milestones might exist in the future," he says . "Peace of mind comes from anticipating the surprises and challenges that may lie ahead."
STORE HERE AND NOW
Once your end point is clear, it's time to focus on the present. "Take an honest look at your finances and write down as much as you can what your income is, what you are spending and what you are setting aside for the future," advises Morris. "Seeing the reality of your current position in black and white may be an awkward exercise for some, but it's the only way you can take control and start making effective plans."
Maura Fernandes is a production manager at Luttrell Productions and another of Morris Powell's customers. Fernandes "sporadically" takes stock of financial matters, often due to important deadlines such as the end of the tax year. "It's a bit of a chore, but also a necessity," she says.
Check out all the ways you can save, invest, or protect your finances. You may already be doing more than you think
For Fernandes, an external soundboard has proven to be essential. “A busy work life, especially when considering a young family, can take up all of your time and leave little room for future planning,” she adds. "With the right guidance, creating a plan is less time-consuming than you might think."
Plan your next steps carefully
"The next thing to think about is what steps you are taking now to get where you want to go," continues Morris. “All employers are required by law to offer a company pension, so the vast majority of people are doing at least something. Look at all of the ways you can save, invest, or protect your finances. Perhaps you're already doing more than you think. "
The sooner you start, the more long-term impact you can get from making small changes. “Start early and go out little and often. You have to enjoy life, so there is a balance, ”suggests Michael Murdoch, CEO and founder of The House London.
Given the great uncertainty and the introduction of IR35, significant wage cuts are the new norm. I try to be as efficient as possible with what I have
Without his retirement, Murdoch tries to plan his personal finances up to five years in advance. "Of course, if you create enough value for customers, you can ask for more and save more," he smiles.
Be aware of all the risks
Finally, take the time to think about the greatest risks you face. "What is the primary financial threat to your family and your current standard of living?" asks Morris. "With this in mind, consider what steps you have taken to mitigate this risk."
Freelance graphic designer Hugo Lees-Jones spends a few hours a month checking that he is managing his personal finances as well as possible. "Given the great uncertainty and the introduction of IR35, significant wage cuts are the new norm," he says. "I try to be as efficient as possible with what I have."
These simple steps will help you take on the things that you can change and hopefully reduce your worries about the things you can't
Lees-Jones has planned the next 5 to 10 years in reasonable detail, but the current uncertainty has put longer-term savings plans on hold for the time being. "So many people live every day," he says. "Plan ahead, even if you only save a small amount."
Focus on what you can control
With the ongoing global uncertainty, it's easy to worry about the future. "These simple steps will help you take on the things that you can change and, hopefully, reduce your worries about the things you can't," says Morris. "Being proactive, having a plan, and making positive changes can be good for mental health and resilience. That way, you can be as prepared as possible for anything life throws at you."
"Once you have the outline of your financial future, it should be much clearer whether you need to save more, have more protection, plan better for your retirement, or make sure your estate is safe for your loved ones." he adds.
"Where are you going next? If you have a project in your professional life that you don't have the in-house skills to do, hire outside resources, ”says Morris. "The same principle applies here: Find an expert you can trust and use their knowledge and experience to find savings, protection or retirement plans that best suit your needs."
For Taylor, having an independent, objective advisor has proven "absolutely important". When he first sought advice almost 25 years ago, he had never considered starting a pension. "It was the kick-start that I needed," he recalls. "It has become an important long-term relationship that is now a trusted friendship and a constant source of reassurance for my plans."
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