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Composer: My budget and planning for the future

Video transcript

my name is Brian Fenton my job is composer and small business owner and my salary fluctuates but last year it was around $250,000 so when I got into Connie melon I was fortunate enough to get a sizeable scholarship and I believe I was left with $50,000 in student loans and my father at the time told me that he but he would pay it off and instead I convinced him on to use that money towards a down payment of a house so when I got into Yale he used that money to purchase a house in New Haven and I was lucky enough to live there I didn't have any room and board it was a two-bedroom so I rented it out I rented the second bedroom out at one point actually slept on the couch and rented both rooms out but after after I graduated from now on we filled the house and he got his $50,000 on his back and I got the profit which was around 40 grand at the time for me living in New York just in general um you know people figure it out you figure out you know where to get an apartment or we're sharing an apartment um as a musician though it's tricky because typically on you know you're forced to write at home it was only until right before I left New York that I actually could afford I had an $1,800 a month studio recording studio that I was working at us but you know you know when you first get to New York $1,800 I'm going to have studio if that was your mean apartment that would be too expensive so you know so it's tricky on that front just saving out where you're going to be able to work is tricky as a musician but for me also with New York City and the lifestyle of New York City while beautiful exciting energetic is such that you're constantly spending money wherever whatever you do you know and it's expensive lunch is $40 then or $60 it's a couple drinks here is $20 just everyday you're spending $100 plus especially when you're in the music field where part of the game is being a social person part of it is networking and going to shows I was living in an apartment that cost about I want to say $1,400 a person so I was $1,400 I don't even think that included utilities at the time $1400 downtown Brooklyn and then $1,800 first for a recording studio so you know I'm at $3,200 not including utilities and then you know trying to go out all the time and living this life that like essentially existed on the streets from cap cab and train a train and I just thought it was completely untenable I was never going to be able to get any further because whatever money I made it immediately evaporated so for me moving to Los Angeles while they were definitely I think interesting benefits and opportunities from a creative standpoint from you is more about a lifestyle change I've been talking to a music supervisor who told me don't you know don't move to July unless this is actually where you want to live don't don't move here as a business move I felt a little bit unhinged in New York I mean I Love New York City um but you're constantly running around you constantly feel on you know a lot of financial pressure and you feel a lot of competition and a lot of just it's just very intense lifestyle so for me LA was an opportunity to create more of a nuclear home I eat at home I stay in my neighborhood I kind of go out a little bit less and and I would say that I work more on my own stuff so my salary last year was two hundred forty six thousand five hundred and eighty five dollars and I have an LLC charted in New Jersey and if it allows me to do our allows me to be taxed in a pass-through manner so I'm essentially taxed as an individual as I mentioned my full salary is two hundred forty six thousand five hundred eighty five dollars and from there I start to deduct business expenses the first of which on my return was advertising which was $249 then the big one which was commissions and fees which includes all the people I hire including my agent and my manager and that amounted to 69 thousand eight hundred and fifty eight dollars after that I have a line item for depreciation which is the depreciation of the gear that I have microphones and recording equipment that was seven hundred nine 7997 dollars after that we have insurance which is booked for in travel and for my gear and then amounted to three thousand one hundred eighty three dollars so for legal fees which amounted to nine thousand fifty dollars this includes my ëno insurance which is errors and omission so just in case I were to accidentally get into a situation where somebody was claiming that I plagiarized their music or one of my composers have plagiarized their music that insurance it's a cost to cover the legal fees for a suit in that in that area after that I have twelve thousand one hundred thirty three dollars in expenses for my office which for me for most of a year within my own house or in my own home then I have twenty thousand four hundred and one dollars for a year every year I buy you know new equipment whether they be plug in so our microphones or instruments after that at 4,000 $189 for supplies for my business and then I had around 16 thousand three hundred and seventy six dollars for travel travel to various clients to pitch new projects and then I have thirteen thousand five hundred sixty nine dollars for meals and entertainment and then I have eight thousand eight hundred and eleven dollars for other expenses notes include additional advertising dues and subscriptions and whether those be for for the Union or for programs that I have that require like music programs that I have that require subscriptions it also includes wardrobe gift to clients and Auto Rentals that I had so my total expensive were one hundred sixty five thousand eight hundred sixteen dollars so you need to deduct that from my entire salary and what you're left is left with is a profit of eighty six thousand nine hundred ninety nine dollars but after that I need to start paying my own personal taxes so I have a self-employment tax which was nine thousand four hundred twenty three dollars last year then I owed the IRS personally seven thousand and I owed the state of New York $3,700 because I moved from New York actually to California so I'm a monthly salary at this point when you deduct that is five thousand five hundred and eighty three dollars from there I have you know my regular monthly expenses so the rest of my rent which wasn't deducted from the office with five hundred dollars the rest of my utilities fifty dollars of course the rest of the internet phone the car which amounts to two two hundred dollars on my student loans which are two hundred dollars a month on my gym membership which is 140 bucks the food that I used or food I make at home every month which is $800 so when you deduct that I'm left with the savings of two thousand eight hundred ninety three dollars a month and last year I used every penny of that to purchase my new home so I use that in the form of a down payment right now I mean I have I've been playing with a little bit of money in the stock market oh I don't know entirely that that's like the best place to go about savings I featured it's more like just fun for now but my goal in terms of saving is that like I have a project right now that I'm working on and that's about to close and that's that that chunk of money I know is going to a Roth IRA afterwards and so I guess that's how I go about savings it's you know I know there's certain projects that when they're they're big enough and when they close I'm going to start moving this money into different areas where I can actually save I think savings in an emergency fund to me are different so for me and kind of have like a rule that that I want at least 20 to 30 grand in my bank account at any time so I feel like if you can you know if one can stick to a number that they always have in their bank account that kind of becomes like a good soft measure as to you know you don't you don't over spend that in that twenty to thirty grand and I keep in my business bank account there's kind of like an implied emergency fund within that so I don't let things go to zero now with regards to savings I do want to save more I look at the house as a form of savings so check all the fittings that it had before and put it in this house so I'm happy with that outside of that like I was mentioning before I had allocated a certain project that I knew that was going to be relatively lucrative to to the goal of putting it in a Roth IRA or at least some portion of it in a lot what I learned about money there started working is that you can always make money if that's your only goal it gets trickier as you start to mix the goal of making money with creative pursuits but the truth of the matter is just a few you know took a job in finance or threw yourself simply into advertising you could make money people make lots of money doing advertising music you know now if you want to have a career in film and also do advertising you know film obviously makes less money making a record makes less money so it's just again parsing through how what how big of a divide it's going to be between the things you actually want to be doing and what are the things that are actually making money the other thing that I learned about making money because I think this is important is that it's important you have if you are fortunate enough to be in a position of the person hiring it's important to have a code of ethics I think when you own a business and things get tough sometimes of your own creation you can pass along the buck to other people so if you're the one hiring people you could easily kind of you know run the numbers on them and an eyeball and pay them less than you think is is it's fair simply because you're trying to make your unit pad your bank account because of something that happened to you and I think it's really important that business owners just have a code of ethics so that we don't you know we don't all suffer from essentially the devaluation of music which is happening right now
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