The sacrifices of an actor

A friend sent this to me on Facebook the other day, and I wanted to share it with you:

THE ACTOR 

Actors are some of the most driven, courageous people on the face of the earth. They deal with more day-to-day rejection in one year than most people do in a lifetime. Every day, actors face the financial challenge of living a freelance lifestyle, the disrespect of people who think they should get "real" jobs, and their own fear that they'll never work again. Every day, they have to ignore the possibility that the vision they have dedicated their lives to is a pipe dream. With every role, they stretch themselves, emotionally and physically, risking criticism and judgement. With every passing year, many of them watch as the other people their age achieve the predictable milestones of normal life-the car, the family, the house, the nest egg. 

But they stay true to their dream, in spite of the sacrifices. Why? 

Because actors are willing to give their entire lives to a moment-to that line, that laugh, that gesture, or that interpretation that will stir the audience's soul. Actors are beings who have tasted life's nectar in that crystal moment when they poured out their creative spirit and touched another's heart. In that instant, they were as close to magic, God, and perfection as anyone could ever be. And in their own hearts, they know that to dedicate oneself to that moment is worth a thousand lifetimes.

"Unknown Author"

Acting Finance (This is a must read!!!)

I regularly read Ramit Sethi's blog (www.iwillteachyoutoberich.com).  He writes about how to get started managing your money wisely.  This is always tricky I find for actors who usually never have a consistent salary.  I wrote him to ask "What is the best way for actors to cover costs yet still save and invest for the future?".

Most average salaried workers should send 50-60% to fixed costs (like rent, utilities, debt, etc.), 10% to investments, 5-10% to savings, and the rest to spending.  But actors could make a ton one month, nothing for 3 months, and sporadic work in between.  The plan for actors is a bit different.  First, figure out how much you need to pay for the bare bones: rent, food, utilities, loan payments, etc. Once you figure out this dollar amount, your next goal is to save at least 3 months worth of this amount- so you can buffer for the moments when the jobs aren't rolling in.  Any extra money you make should go to this buffer savings account.  Once you have successfully saved your cushion, now you can start investing in a Roth IRA (no contribution is too small!).  There is also something called a Solo 401(k) and SEP IRA for the self employed, which are great alternatives to a traditional large company 401(k).  The rest of your money you can spend on your next vacation, new headshots, or those cute shoes you've been eyeing.  Just keep your spending in check and be sure to pay off your credit card in full every month (Read Ramit's blog on the disastrous effects of not doing so).  Another great budgeting tool for actors is www.youneedabudget.com--it bases spending on last month's salary (since you don't always know what is to come next month!).

Some other tips from Ramit:

- Call your credit card to lower APR or ask what benefits they can offer.  I called mine, and got a fee waived when I missed a payment because I was on vacation and forgot.  A phone call does work!  Also, try calling your bank to eliminate any recent overdraft fee or ATM fee.

- Online banks often have better rates than traditional banks-- may help you reach that "cushion" fund quicker.  Try ING Direct, Emigrant Direct, or HSBC Direct.

- Invest!  Don't wait until later.  If you invest $10/week, in 10 years you'll have approximately $8,136 (based on an 8% average return).  Imagine 20, 30, 40 years more...that's one less lunch or trip to Starbucks a week.

- Automate your money flow to avoid late payments and other fees.  Plus if you automate that $10/week to invest before you see it, you won't miss it.  But you'll be thankful when you retire!

- When trying to curb spending, focus on big ticket items (like eliminating subscriptions, talking to your landlord to lower rent, and getting rid of HBO for your cable bill--how often do you actually watch it?).  This leads to bigger returns than just going to Starbucks less.  Spend on what you value and cut back on what you deem as not necessary.  I spend big on vacations, but I rarely buy new clothes and try to rent movies at the library as well as lowered my rent.