It’s been a goal of mine to help my fellow musicians learn more about how to invest. Whether it be fixing up and flipping or buying and holding houses, private lending, or something as confusing as ‘buying defaulted notes’ (What?!?!) or some other methods for making their money work. A bigger goal is to actually get them to invest safely. It is with this in mind that I’ve started writing this series to help musicians and other artist/creative types that see the need to begin, but might be unsure of how to begin.
The eternal question for most musicians is: “Where’s my next gig?” Even at the upper echelon of the industry, this question remains. Whether you’re subbing for a week, or in the middle of a two-year tour with the biggest names in pop music, the question invariably is asked. Over and over and over again. Just part of the gig, right? But inconsistent income can wreak havoc on planning for the twilight years. This is a tough life, no question. If we don’t take care of our money today, we most likely won’t have any tomorrow. Is your plan non-existent? Are you doomed to fail? The answer depends on what you do next: Keep reading and take action, or blow it off for another day. You can learn to invest wisely and stop worrying about the next call to get a gig.
Musicians can make outstanding investors: We understand how to invest time (without the guarantee of success). We understand the need to buy assets (gear that’s good and will work after years of use). And we know about changing markets – Neil Sedaka is a great example: Between 1958 and 1963, he sold 40 million records. By 1967, his label had dropped him. (Thanks Paul, John Ringo, and George!) We even know about changing mediums: 8-tracks, cassettes… even CD’s! We are indeed built to change.
Many of the musicians I know tour the world playing with some of the biggest names in the business. They don’t have a consistent daily home life. Many times, they’ve left home for a week or maybe a year. While it seems great and amazing to a person not in this biz, this lifestyle has many challenges: Relationships can suffer, re-integration is sometimes tough, and learning how to invest usually isn’t a huge focus, if even a concern.
Some of my Funding Partners fall into this category, it seems that they’ve taken a very active ‘passive strategy” that works well for this life/career. I’ve gotten good feedback from them on how Private Lending fits well within their lifestyle. Most didn’t start with huge amounts of money to invest, either. The big thing they did? They started.
Most of the musicians I know that don’t begin, blame it on many things: “I don’t understand…” or “It’s too risky…”. Sometimes, it’s the ‘Analysis of Paralysis’: “Let me look at it for a while…” is a familiar one. These are all very legitimate concerns. But these are NOT reasons for not getting started! If you’ve read this far, you might actually be interested in learning more… and you’re willing to invest the time. That’s the way investing works. It starts with education. Here’s an easy way to start:
- Take action (Now!) by writing down 7-10 different investment vehicles that you’ve heard about over the years.
- Narrow the list to 5 based on what you think you’d be most comfortable doing – either you know how, or are sufficiently intrigued and want to learn more.
- Research each of these and do the Ben Franklin: make lists of Pro’s vs. Con’s of that kind of investing.
- Further narrow this list to the top 2-3 by asking yourself, “Can I invest in this consistently for at least 2 years?” and, “How excited am I about this?”. Very important: “Are there people doing this and seeing tangible results? Can I speak to them?” (I hesitate to consider any network marketing, multi-level marketing, or ‘home-based business’ as a true ‘investment’. Success in these types of businesses depend on your networking abilities, and your sales skills. There is also a heavy need to invest your time, which you might not have.)
- Take action. Every day. Learn. Learn More. Find a group of people (MeetUp.com, Craigslist, or someone doing it) that you can turn into a mastermind to build momentum, ask questions, and spit-ball ideas with. Perhaps to partner with, also.
We’ll leave it here for today. Start your list. Take action NOW! And tell me the answer: What are you going to take action on today that will help you learn how to invest?