This post is part of our #FinanceYourDance series that we’ve created to help support you in your pursuit to get financial support for your projects, and build financial stability and freedom for your personal life as well. This is a positive and empowering movement, which will have many components to it. Learn more about the #FinanceYourDance movement here.
This post is based on two, life-changing books that I’ve recently read by Dave Ramsey. The first entitled, “Total Money Makeover”, and the second entitled, “EntreLeadership”. First and foremost, I would like to suggest that you purchase and read these books immediately! They will change your life, and help you to avoid some serious pitfalls in life, personal finance, and business.
In both of these books, Dave Ramsey reinforces the importance and necessity of saving, having an emergency fund, getting out of debt, not using credit cards or loans to fund your personal endeavors, or your business endeavors, and how by doing so, you release cash flow to invest in your business. dream, and future. Three of the major pitfalls for dancers, artists, and entrepreneurs, are lack of emergency savings, debt, and unpaid taxes. Any one, or a combination of these three, can be detrimental to your career, financial stability, and personal growth. Here’s how you can apply this to your life/career as a dancer/choreographer/dance teacher/dance entrepreneur.
The Top 5 Ways To Build Wealth And Financial Security
1. Save Your Money And Create An Emergency Fund. This is one of the most important and crucial steps to building wealth and financial stability in your life or business. An unexpected emergency can really rock your world if you are not prepared for it. I’ve also found that the anxiety of knowing that you don’t have any emergency savings can be very stressful and draining, even if nothing has happened yet. Dave suggests saving $1000 immediately, if you don’t have any savings at all. That’s enough to help you get through many of the typical emergency situations. However, ultimately, you want to save up six months worth of your monthly expenses, for your emergency fund. Save yourself the stress, and avoid being forced to go into credit card (or other forms of debt) because of unexpected emergencies.
2. Get Out Of Debt ASAP. Debt is another biggie. Debt is the reason why most artists, and frankly, everyday people, are unable to build wealth, and be financially free. When you have looming debt, hanging over your head, your money is never really yours because you owe people money. Whether it’s credit card debt, student loans, a car loan, medical bills, or whatever, it doesn’t matter. Get aggressive, get radical, and get rid of it as soon as possible, and free up your current income to be used towards the things that really matter to you, and build a solid financial future for yourself, and your family.
3. Don’t Use Credit Cards/Loans To Fund Your Dream. When you have a great idea, or a passion to start your own dance company, dance studio, or dance business, it’s very tempting to use credit cards or loans to get yourself started. This is a bad idea. Dave Ramsey breaks down the reasons why so well in his books. But what I can tell you is, you shouldn’t spend money that you don’t have, and that’s what credit cards and loans represent. Stay away from it altogether, and build your dream, little by little, one step at a time, and don’t dig a financial hole for yourself.
4. Differentiate Needs From Wants. The line between needs and wants has become so blurred, that we can actually justify why we NEED a particular thing, that is so very clearly a want. Even the purchase of those things which will help you build or grow your dance business or career, should be considered very carefully. You should, under all circumstances pay cash for the things that you need or want to buy, period. Thanks to the internet, there are always many ways to get things at a serious discount, between eBay, Craig’s List, and other discount sites, not to mention, bartering, or selling something of value that you currently own, to get what you want. There are many ways around it, so get into a spirit of being disciplined, and get honest with yourself about what is really a need vs a want.
5. Pay Your Taxes. This is a BIG DEAL! Take it from someone who has made numerous mistakes in this department. Do not mess with the IRS. They are no joke, and they will come after you. I know how tough, and frustrating it can be to keep track of your income and expenses, hold on to receipts, file your taxes, etc. as an independent artist, but, we have to do it. Dave Ramsey suggests that business owners set aside 25% of their income to put into a tax savings account. I would recommend the same for dancers/artists. Play it safe, and don’t mess with the tax man.
This is a very brief overview of how you can begin to get on the right track, and avoid some serious pitfalls in the pursuit of your dance dream, and financial freedom. To get the real nitty gritty, you need to go to Dave Ramsey‘s website, and start reading his books immediately. They will change your life.
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What financial challenges have you faced in your life/career as a dancer? What has worked for you? Please share your thoughts and feedback in the comments section below.
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