Artist Marisabel Gonzalez during exhibition preparations. See more of her work here. Photo courtesy of the artist.

Most creatives wish they were better with money, but they don’t know how to start.

When money comes in from a project or your bi-weekly paycheck hits the bank account, you already know where that money is going—typically covering monthly expenses or your monthly credit card bill.

A lot of artists are part of the 58% of Americans living paycheck to paycheck in 2023. Visual artists have to balance their passion with the reality of saving for retirement, emergencies, or being able to afford the down payment on a large purchase like a house.

While it can be difficult to achieve these large goals, it's not entirely impossible.

This series on finances will help you look at which steps you can take to make a plan for yourself regarding your finances and work towards a predictable and more stable income.

 

How can you start budgeting for the life you want as an artist?

Artwork Archive’s budgeting worksheets can help you take the guesswork out of living within your means. These worksheets are best used when you’re ready to get really specific about your budget, say as in one of the following scenarios:

• You know you are living beyond your means and want to address what categories you are overspending in.

• You want to work toward earning more of your income from your art practice but are not sure how much money you need to earn annually to continue to maintain your lifestyle somewhat.

• You are planning to move in the near future and want to understand holistically what lifestyle you can afford in the place you will be living.

Starting with the example where you know you are living beyond your means and want to address what categories you are overspending in, this is probably the easiest application of the Artwork Archive worksheets since the numbers are already available for you on receipts and statements. Perhaps you’ve been working the same job or combination of jobs for a while and you feel like you never have enough money left over despite working all the time.

You don’t see a way to improve this for yourself despite perhaps wanting to take a vacation or to switch careers. You feel stuck.

How can you calculate what you need for your cost of living as an artist?

First, consider if you are fully utilizing your earning potential.

Assuming you are able and want to work 40 hours (or more) a week in this scenario, we’ll also assume that you're earning a liveable wage which in 2023 for a single adult is around $38,000 annually or $730 a week pre-tax. These numbers are national though so also take into consideration if you live in an expensive area or a less expensive one— generally in the United States, metropolitan areas command a higher cost of living (COL) than rural ones. Look up the COL for your specific area and verify that your income falls within the range of income the majority of people earn to live on.

Let’s say you are a family of four living in Cambridge, Massachusetts. Assuming you and your partner earn a combined income of $150,000 pre-tax you would be considered to be earning a living wage since the cost of living in Boston is $139,000 pre-tax. Knowing this, complete the worksheets and identify your areas of opportunity, keeping in mind the classic 50/30/20 financial planning rule. 50/30/20 divides spending as: 50% of income for “needs”, 30% on "wants," and 20% for savings.

Perhaps seeing where your money goes will motivate you to renegotiate your phone bill or resell clothing you are tired of to work towards getting back on budget. Maybe you’ll see that you’re spending far too much on monthly rent and decide it’s worth it for your family to move to a less expensive neighborhood or apartment. You may also want to consider alternative methods of income for your art business that you can explore.

Get a sense of your current art sales with a sales report on Artwork Archive

You can also use the Artwork Archive's budgeting worksheets when you have the goal of earning more of your income from your art practice, but you're not sure how much money you need annually to live. Again, starting with the income you already earn is easiest here, so add up your job (or jobs) to see how much money you currently make.

If you have multiple revenue streams this can be more complicated so look over a few months of freelance gigs and average them if needed.

To make this easier, you can keep track of all your revenue and art sales within Artwork Archive's Revenue and Expense feature. This way, you can get an overview of your finances at any time. Take a look a the example income report below to get an idea of how you can see a breakdown of your finances. 

Once you have a number, say $70,000 pre-tax, look at where each part of the total is coming from—maybe in this example, the artist is an adjunct making $24,000 annually from teaching, $30,000 from a job at a local market and $16,000 from artwork sales.

An example of an income report on Artwork Archive

Consider adjusting your budget

Consider if your budget could be redesigned around a smaller (initial) number, say $40,000 a year. In this example, that would allow the artist to quit their market job, presumably to have more time in the studio to work on increasing their earnings from their art sales. Use the rest of the budgeting worksheets to calculate how you could live on a reduced budget.

It may not be possible to make such a drastic reduction at first, so consider if the worksheets reveal any half steps— looking at this example, maybe the artist could start by going part-time at the market until they saw an increase in their studio sales. This would allow them to live on $55,000 a year while opening the opportunity to earn more from their art since they would have more time.

The budgeting worksheets can also be used for future planning like a potential move where you might want to understand holistically what lifestyle you can afford in the place you will be living. Instead of starting with knowing how much money you have to spend, you’ll be building towards understanding the range you will need to earn to live exactly where you want.

Tip: Learn more about how you can track your income and expenses, plus how to increase your art sales using online invoices on Artwork Archive in the short webinar below. 

How can you put this budgeting into practice?

Let’s say you are a recent art graduate wanting to move to Brooklyn, NY.  Start by looking up rent prices in the neighborhoods you’d like to live in and calculate the average price on what you’re seeing.

Consider if you’ll have roommates or be sharing the rent with a partner. Move through the worksheet using each category as a prompt for research— how much does renter’s insurance cost in Brooklyn?

Will you have a car? What will it cost to maintain, park, and insure a car in New York? Once you’ve completed Artwork Archive's budgeting worksheets, add up your numbers to see how much money the life you’ve envisioned for yourself actually costs. If you’re shocked by the total, see what you can let go, at least for now. Can you not adopt a cat for the first year you live in New York? Can you walk instead of riding the subway? Ask all these questions and more until you’re at a total that feels comfortable.

Remember to use the Income and Expense reports in Artwork Archive to get a sense of where your current art sales and other revenue and expenses are coming from regarding your art business.