Our youngest kid just got his Level 2 driving permit, which means he can drive by himself. (Sayonara, carpool!) He and I spent a lot of time practicing leading up to his driving test, and one lesson I stressed over and over is always always check your blind spots before changing lanes. Every vehicle has them, and no amount of experience behind the wheel changes that fact.
Jump to How Financial Planning Helps
Blind spots are, by definition, the things we can't see. In the car, you can triple check your mirrors and take a quick peak over your shoulder before changing lanes. In life, your friends, family, and coworkers can make you aware of things you might be missing.
But what about your financial blind spots?
Here's a little secret: everyone has them and – because the number one rule that people learn is don't talk about money – you can't always count on family & friends to notice or clue you in. That means most people make up their own rules about how to manage money based on lessons & observations going back to childhood, which can lead to some ... less than ideal money beliefs & habits. But even if you have a healthy relationship with money, there are probably still some important things that aren't on your radar.
How Financial Planning Helps
Financial planners help people take action to change their financial realities. We discuss best next steps, help you implement them, then track the process. But financial planners can also help you spot important issues that can impact your financial health that might not be front of mind. Here are a few examples:
Are you a disciplined investor? You might be surprised to learn that the amount you keep out of the markets in cash accounts can make you a better investor by avoiding selling investments at the worst possible time.
Planning for retirement? You might not immediately think of insurance coverage, but an injury or illness that keeps you out of the workforce could derail your plans.
Want to help your kids pay for college? Estate planning can make sure that your wishes are carried out in the event that you pass away unexpectedly.
These are just a handful of the ways that comprehensive financial planning can help you navigate your own financial blind spots. Want to find out more? This 21-Point Wealth Builder Checklist quickly points out areas that you are managing well – and those that need more attention. After you complete your checklist, I'll send you an email outlining why each "no" answer is an important opportunity and ways you can address them. Click the button below to get started.
5 Common Financial Blind Spots for Creatives - and How to Avoid Them
While everyone has financial blind spots, artists, musicians, creatives, and other independent professionals have extra risks to consider. Creatives often lack the stability & security of a steady job, which means that they can't rely on an employer to take care of next month's income or paid sick days. While some of the struggles and risks are well-known, others may be unknown, underestimated, or ignored completely. (Here's some free advice: ignoring a potential risk never makes it better.)
Here are 5 common financial blind spots for creatives and how to avoid them.
Planning for Lumpy Income: When you work for yourself – especially in the arts – it's difficult or impossible to answer the question "how much will you make this year?" Creative work can be all boom-or-bust, alternating between months of high income and months of low-to-no income. So how do you plan for the future with irregular income?
Understanding How Much You Spend: Ever have a really successful year and still find yourself asking, “where did all that money go?” Income is only half of the equation when it comes to managing irregular cash flow: you also need to have a reasonably accurate understanding of how much you spend each month.
Underestimating the Importance of Emergency Funds: Saving for a rainy day seems like the most boring thing you could do with your money during good times – and the absolute smartest decision when things go wrong! An emergency fund – cash set aside specifically for unplanned expenses – isn’t as exciting as buying something cool or investing in your future, but it is the backbone to any artist's or creative professional’s financial health.
Lack of Retirement Planning: A lot of artists, musicians, and creatives do what they do because they love it. The idea of a traditional retirement – work & save for 40 years so you can quit working forever – just doesn't make sense if you actually want to keep working for the rest of your life. That doesn't mean that you should ignore retirement planning completely; perhaps a little reframing is all that is needed.
Not Working with a Financial Advisor: Ever felt like professional financial advice was for other people with straight jobs and “normal” lives? Just because you have an unconventional profession doesn’t mean that you have to go it alone! Certain advisors (ahem, like yours truly) are proud to serve people who have charted their own paths and don’t fit neatly into conventional boxes.
Want to find out some of the ways that financial planning could help you? Click the button below to get started on your 21-Point Wealth Builder Checklist. It only takes a few minutes to complete and gives you a summary of things you are doing well – and areas that could use your attention.
Thanks,
Timothy Iseler, CFP®
Founder & Lead Advisor
Iseler Financial, LLC | Durham NC | (919) 666-7604
Iseler Financial helps creative professionals remove stress while taking control of their financial lives. We'll help identify your current strengths and weaknesses, clarify and refine your long-term goals, and prioritize decisions to improve your financial well-being now and later. Reach out today to take the first step.
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