I Need to Make More is a Really Terrible Income Goal

I Need to Make More is a Really Terrible Income Goal

For those of us that don’t love numbers we often use the same words over and over to describe what we want with our money: more, less, and enough.

“I just want to have enough to live my life.”
“I need to make more money.”
“If only I could spend less, things would be much easier.”

But those are really hard things to do, and they’re made even harder because you haven’t given yourself any tools to actually solve the problem.

How much is enough? How do you know when you’ve gotten there? How much more money do you need to make? Are you just going to take every single job possible until it feels like enough? And spend less… on what? How much less? How much are you spending now?

Real Numbers Help Solve Real Problems

Putting real numbers on things is scary. It really is. Maybe you’ve experience that already by filling out the KNOW YOUR NUMBER worksheet or using THIS SPREADSHEET to map out your income for the year.

Maybe half way through those exercises you wanted to shut it all down.

The fear is real.

But on the other side of the fear is a tool. A tool for you to solve some of that stress that you’ve been feeling lately.

By putting thoughtful numbers on the way you live your life you can start to map out real opportunities for change. You can create a plan that lets you live the way you want and move forward on some of the big stuff.

Income Goals Can Help A lot.

Lots of us in the self-employed realm are what the internet calls ‘hustlers’. We take every job that’s thrown at us. We feel desperate to take every opportunity to earn income because you never know when all the work is going to dry up and the phone stops ringing.

Again… the fear is real.

A number that can really help in that war against fear is an income goal to aim for and there are a few different ways to think about making one.

  1. How much do you need to earn to cover your expenses: one way to build an income goal is to come up with your ‘breakeven number’. How much do you need to earn every money (or every year) in order to make sure all the bills are paid.
  2. Giving yourself a stretch goal: Let’s say you know your break-even number… but you want to go bigger. You can set yourself a goal that pushes you to grow more. I’ve been setting these kind of goals for the last few years and they can be really useful… and also terrifying.

If you’re interested in figuring out what those numbers might be, try THIS TOOL out (here’s A TUTORIAL to help you figure it out).

Balancing the stress of earning with all the other stuff you’re trying to do

People who work more conventional jobs often don’t have the option to ‘make more’. Unless they want to negotiate a raise, they’re stuck earning what they earn.

But as always, with great power comes great responsibility.

When I talk to clients about making income goals, whether it’s to cover their expenses or a stretch goal, we talk a lot about what’s possible and what that might look like.

Remember, there are so many parts of work besides what we’re getting paid for it. Is it the kind of work you enjoy doing? Does it still allow you the time and energy to do the other important things in your life?

Yes, you can make more money, but is it worth it? Maybe it’s a better trade off to spend less in order to balance out your enough.

… I know that sentence is almost entirely useless to you. But if you keep rolling those questions around in your head and start replacing those words with thoughtful numbers… you’re going to start feeling way more control over your money.

Emily Nixon

Emily Nixon

Rags to Reasonable Community Outreach Coordinator

Emily Nixon is an actor/writer/director/filmmaking Swiss Army Knife. She is also a big money nerd and Community Outreach Coordinator for Rags to Reasonable.

She came to this work after becoming completely fed up with living paycheque-to-paycheque and being too afraid to look in her chequing account. She is passionate about empowering other artists and variable income earners to keep doing what they love and feel confident about their finances.

Email Emily at emily@ragstoreasonable.com

Want to start getting control of your money? How can I help?

You Need a Budget…And Maybe Some Donuts

You Need a Budget…And Maybe Some Donuts

My name is Dashon and I’m an opera singer just like Chris. We met after many years of hearing of each other, but, as it often works in the classical singing world, we didn’t meet each other until we were eating meringues together in the heart of Paris. C’est la vie!

I have known Chris’ wife Mireille Asselin, another amazingly accomplished opera singer (seriously, you have got to listen to her amazing voice!) for many years, and she has told me about Chris many times. To meet up with friends, old and new, is always a joy! Between bites of stuffing our faces with lovely food, we started to talk about our projects. As much as we love music, when you’re in “the biz,” it’s also great to share what gets you excited about the world outside of the arts, as well. When we got to sharing about our love of budgeting, it was a lightning bolt right in between my eyes!

We all have these moments when we know that we have found a partner to navigate the rough and choppy waters, and for me, even though I had just met Chris, I felt very welcome to talk about my finances and the practical pressures of being an artist. Having a mentor is absolutely essential in our field, and looking up to peers is just as important for me; they understand exactly what I’m going through in a way that few other people can!

 

The YNAB Connection

Chris and I both have wonderful histories with the app You Need a Budget (YNAB), and for good reason! It has truly saved my sanity, which has in turn allowed me to save my finances and to conceive of my limited resources differently. However, the road to using it as often as I do (I love getting to it every day, it helps my system not pile up, and it definitely helps to remind myself of my goals for the future) wasn’t always so straight.

I started using YNAB about 6 years ago, after I read about it on the Internet (my true love in this world, second only to an excellent donut…). People were saying all sorts of things that piqued my curiosity:

“It changed my life.”
“It’s amazing.”
“I finally got out of debt.”
“I was able to save up to help my family achieve their dreams.”
“This is the most delicious thing I have ever eaten, so perfectly crisp and filled with my favorite Bavarian Cream, I will definitely be back!”

(One of those might have been about donuts, sometimes I confuse my open tabs, of which there are many…)

So, I fired up the computer, signed up for an account and promptly used it with the vigor of a New Year’s Resolver for a few months.

Then, not really having identified any goals… it just became another way to track my money. I’d been using other apps to do so, and while it certainly was interesting to see how much money I was spending on various things, there wasn’t a true understanding of what it was doing for me. So I went back to my other hobbies and other interests, and I just let it go.

 

Rinse, and repeat. For the next two years.

I’d give it a go, and would get tired of tracking, and didn’t really know what I wanted anyway. Even though I had student loans, and credit card debt, I never really thought about that. To borrow a phrase from another friend: those things were “a problem for Future Dashon.”

After a while, though, I started to get a knock at the door of my heart. I have no clue who let him in, or how he found me (my sense of time as a musician is usually great, as long as I don’t have to count higher than four), but there he stood: Future Dashon.

He wasn’t so bad looking, which was nice, but he definitely had a few harsh words for me, which wasn’t so nice. My finances had become messy, and I started to realize exactly how stressed out I was.

 

As artists, we are so used to improvising, and the idea of the “starving artist” is so pervasive, that it becomes a part of our self identity.

I didn’t believe that I deserved to be free of stress, because I just thought that’s how things were!

Great things to hand down from generation to generation via the mentor/student relationship: vocal technique, an endless curiosity and love of your craft, and respect and love for the traditions that you encounter which speak to you. Not such great things to hand down: the idea that getting ahead is impossible, the notion that in order to be successful you absolutely must sacrifice everything financially, and other assorted stereotypes of artists.

 

Go time.

So, after a couple of years of back and forth, I decided to really settle in, buckle up, and ask for help. One of the best things about YNAB is the community of users on the Internet. The official support staff, as well as other wide-eyed travellers were at the ready to help me, and are definitely ready to help you with any questions. I explained my situation to them, posted a lot of screenshots, and they helped me clarify my needs and wants. Finally, things were starting to click in.

More so than the actual method, what was clicking in for me was the need to make goals. Even if I couldn’t stick to them perfectly, knowing what my priorities were (and are) saved my sanity. And that, in turn allowed me to know not only what to spend money on, but why I was spending on those things. That, my new friends, is true freedom. The “learning curve” isn’t as steep as it may seem, and if you can master Yelp to find the best donut shop, you can definitely master your budget. Equally delicious.

Celebrating my YNAB Birthday

Just as I am writing this, I’ve decided to think of one of my favorite days of my life: my YNAB birthday. February 25, 2013 was so important to me! Even though I had a very circuitous route to learning how to use the software in a way that brought me freedom and joy, it’s a great thing to celebrate. Make today your YNAB birthday! Reach out to any of us here and we’ll help you along the way. Your future self will thank you.

Check out You Need a Budget HERE.

Dashon Burton

Dashon Burton

Opera Singer and YNAB Enthusiast

Dashon Burton is a singer based in New York City, and dreams of donuts on the reg. Raised in the Bronx, he found a musical life while in high school in Williamsport, PA that changed his life forever. After graduating with a degree in Vocal Performance from Oberlin College, and later received a Master’s degree in Early Music from the Yale School of Music in 2011. Since that time, he has been a full time performer and educator, and has sung in opera houses and with orchestras around the world. For more information: dashonburton@gmail.com
How to Start Organizing Your Expenses … Just Like Marie Kondo

How to Start Organizing Your Expenses … Just Like Marie Kondo

Just like everyone else with a Netflix subscription, I’ve been watching Marie Kondo’s show ‘Tidying Up’.

And here’s the thing… a lot of the things that stress us out about having a messy house are the same things that stress us out about our finances.

That feeling of having a stressful environment, the sense that there isn’t an order to how or why we do things can make it feel like we’re just surviving instead of living our lives the way we’d like to.

If that feels remotely familiar, let’s steal a bunch of Marie Kondo’s ideas and see if they can help.

 

#1:Dump everything out onto the bed

When it comes to sorting clothes, Marie starts by making people dump all the clothes in their house into one big pile. This totally works for money too!

One of the big reasons why it’s hard to get a handle on how much we’re actually spending in our lives is because our spending is so fragmented. There’s a couple of credit cards, a chequing account, and your PayPal account.

The first step is to try and make a big ole heap of all the things that you spend money on.

Remember, we don’t start sorting by making things organized. We start organizing by making a mess and getting a sense of everything that needs to be organized.

For expenses there are a few ways to do this.

  • You can grab a pen and paper and brainstorm everything you spend on.
  • You can skim (SKIM, NOT SPEND A TON OF TIME WITH) your bank statements and get a bunch of ideas.
  • You can use THIS WORKSHEET to give you some ideas of the various things you spend on.

Remember to include everything you spend: monthly expenses, annual expenses (Christmas, summer, etc) and business expenses.

 

#2:Like things go together

Once you see the whole picture you can start sorting things into piles.

I recommend you think about expenses in the following heaps:

  • Fixed Expenses: things that are the same every month (rent, cell phone)
  • Other Monthly Spending: things that happen every month but are different (groceries, takeout)
  • Annual Expenses: things that happen a few times throughout the year (Christmas, dental, clothing)
  • Business: things that are specifically for your business

A quick note on business expenses: for those of you who are one person businesses, many of the things in your personal lives are partially business expenses. Lots of people get really confused when I ask them to separate these ‘business’ costs from their personal life. Remember, this is not a tax exercise, this is an organization exercise. Start with the costs that are clearly business: the training, the commission etc. Then start dealing with the grey areas – your rent which includes a home office. Don’t spit them, just put them in the pile that they are most like. You can always move them later.

 

#3:Does it bring you joy

The crux of the Marie Kondo philosophy is around picking up an item and asking it … does it bring you joy.

This is a really useful exercise when it comes to your spending. In our weekly email a few weeks ago we talked about Emotional Return on Investment and Emily made a series of worksheets to guide you through the process of figuring out what expenses are adding to your life, and what are things that you really wish you could throw away.

 

#4:Quantify it: How much do you need

This is the part that’s different.

Once you’ve got everything sorted into piles and filtered through your joy lens… then start looking at the numbers.

How much do you need? What expenses do you know off the top of your head? Which ones are harder?

One of the things I love the most about Marie Kondo’s philisophy is there doesn’t seem to be any shame in the decisions that her clients make. She doesn’t care if you keep all the clothes or all the books… she just wants to make sure that you really want to keep all the clothes and all the books.

That’s what I want for you too. I don’t want you to feel shame around the amount of money you spend on things, but I want you to think deeply about those numbers and make those decisions on purpose… instead of by default.

… and I think that’s what Marie Kondo would want too!

Emily Nixon

Emily Nixon

Rags to Reasonable Community Outreach Coordinator

Emily Nixon is an actor/writer/director/filmmaking Swiss Army Knife. She is also a big money nerd and Community Outreach Coordinator for Rags to Reasonable.

She came to this work after becoming completely fed up with living paycheque-to-paycheque and being too afraid to look in her chequing account. She is passionate about empowering other artists and variable income earners to keep doing what they love and feel confident about their finances.

Email Emily at emily@ragstoreasonable.com

Want to start getting control of your money? How can I help?

Am I Spending Way Too Much?

Am I Spending Way Too Much?

Did you know that in Sweden all salaries are public?

You can just login to a database and take a browse through what all your friends make for a living… which from a North American perspective is a pretty hard thing to imagine.

What you make is something we tend to obsess about, whether we talk about it or not.

I think everyone has a basic idea of what an average salary range seems to be (even though I’m sure if we adopted the database system there might be a lot of surprise).

What we really don’t have much of an idea about is… what are people spending? And more importantly… is what I’m doing okay?

Is $2,000 of expenses a month a lot? Is $12,000?

What if I told you I spend $2,000 a month on my personal expenses?

Does that seem high to you? Way too low? Or are you just curious about how that might relate to what you spend?

What if I said I spend $10,000 a month?

… it’s higher… but what if that was total family income with 4 kids? Is that too much?

It seems whenever these kind of spending numbers come out, people get judgey without any real basis to make those judgements.

“Well… it’s WAYYYY more than I spend… so it must be too much”

OR

“They spend half of what I spend… they must be some kind of wizard”.

This is where the view we have of numbers being black and white is kind of misleading. The numbers in isolation don’t matter in the slightest…

Saving is good, Spending is bad

“Everyone” knows that you should be saving all the money and spending none of the money, unless you have managed to spend that money getting something for an incredible deal.

But also… that’s stupid.

We all spend a ton of money on the present. It’s pretty damn important. And what that amount is doesn’t matter as much in relation to other people as it does in relation to your own personal ecosystem.

So the first thing that I want from anyone asking the question “am I spending too much” is not to worry about there being any cosmic absolutes. There is just you (and your family), your money, and what you’re trying to do.

After you’ve accepted that it’s about exploring that balance for yourself:

  • What are you trying to do? How can money help with that?
  • What do you need to run your life? What is important to you?
  • How much can you expect to make? What feels like a safe estimate?
  • How do those things balance out? Are you spending way more than you think you’ll bring in?

It’s in the balance, the relationship between your goals, your needs, and your resources.

That balance might be $2,000 and it might be $10,000 but if it’s not balanced… there’s probably going to be some stress… no matter how ‘normal’ you feel.

Emily Nixon

Emily Nixon

Rags to Reasonable Community Outreach Coordinator

Emily Nixon is an actor/writer/director/filmmaking Swiss Army Knife. She is also a big money nerd and Community Outreach Coordinator for Rags to Reasonable.

She came to this work after becoming completely fed up with living paycheque-to-paycheque and being too afraid to look in her chequing account. She is passionate about empowering other artists and variable income earners to keep doing what they love and feel confident about their finances.

Email Emily at emily@ragstoreasonable.com

Want to start getting control of your money? How can I help?

Magic Time and Magic Money: The Danger of Goal Setting Without a Plan

Magic Time and Magic Money: The Danger of Goal Setting Without a Plan

When I was in Grade 10, my teachers made me a t-shirt that said “Sign Me Up!” with a picture of me in velvet pants prancing like a pony*.

I have always had the bad habit of signing up for more than I can humanly do. I just love the excitement of saying “I can do it!” and seeing the relief in a person’s face. I also love planning grand and exciting adventures for myself.

Last year, I decided I was going to spend December in India. “Great!” I thought. “This is important to me and a manageable goal.” The months went by and I did…nothing. I was still thinking to myself “yup, going to India in December!” But when December came around, I hadn’t done a thing to make it happen. So of course, no trip to India. I was planning with money that didn’t actually exist.

I catch myself doing the same thing with time. I look at a day off and say to myself “I’m going to do laundry, go to the gym, do two hours of meditation practise, write a new draft of a project, cook all my meals at home, go grocery shopping, do laundry AND finish in time to have a dinner date with my partner!”

As if.

Sadly making a goal doesn’t magically make it happen

In the case of my trip to India, I was planning with what I now think of as “magic money”—money that I don’t have and don’t have a plan of how to get it.

In the case of my day off, it’s “magic time”—time that I don’t really have and am expecting to pull out of the ether. In both cases I’m planning to spend a resource beyond my means.

The real danger of planning with magic resources is that either the plan is going to fall through, which can cause feelings of failure, shame and other fun internal states OR you’re going to turn to the dark arts to get things done – debt. Now debt can be a useful tool, but it comes at a cost (like all dark magic does). And don’t even try to tell me that debt is only a financial thing. We’ve all felt the feeling of being exhausted by pushing ourselves too hard – that’s time debt.

The antidote to magic time and magic money is awareness.

When I say yes to something now, the first thing I do is identify what resource I am offering. Is it my time, money, or both? Then, I ask myself if I really have the time or money that saying yes requires.

If not, it’s a magic resource and I need to rethink things. I either need to say no or make a plan of how to find more (work an extra shift a week or cancel dodgeball practise on Wednesday).

Sure, it’s not as much fun as saying “yes” and imagining a version of myself that gets to do every project or travels the world constantly. But it means that I actually get to do some of these fun things by only committing to the work I can handle, instead of saying yes to everything and doing none of it. And maybe that’s the real magic. I’m sorry, I couldn’t help myself.

*I regret nothing about that photo.

Emily Nixon

Rags to Reasonable Community Outreach Coordinator

Emily Nixon is an actor/writer/director/filmmaking Swiss Army Knife. She is also a big money nerd and Community Outreach Coordinator for Rags to Reasonable.

She came to this work after becoming completely fed up with living paycheque-to-paycheque and being too afraid to look in her chequing account. She is passionate about empowering other artists and variable income earners to keep doing what they love and feel confident about their finances.

Email Emily at emily@ragstoreasonable.com

Making a Plan: With a Sketch and a Whole Lot of Stretch

Making a Plan: With a Sketch and a Whole Lot of Stretch

I didn’t jump out of bed on January 1st 2019 excited to face a new year. It was mid afternoon when I decided I was putting off the new year for a few more days.

“My new year starts on the 3rd” I told my wife.

… it started on the 4th, and the stress hit the next day.

I was sitting at my computer trying to wade through a pile of emails and tasks that I had secretly promised myself I would finish over the holidays with ‘all my free time’. After an hour I reached that place where my brain just said … nope… and any idea of work stopped.

I needed to step back and get organized. I needed a plan.

First of all, let’s talk about what a plan is (and what it isn’t)

I am not a born planner. For many years I believed that any kind of plan would stop me from being spontaneous and living in the moment.

What’s made me a convert is that I learnt that a plan is not a strict schedule that I must adhere to, but an exercise in which I use my imagination to sketch a version of the future which helps me answer one question: what should I do next?

This is true whether you’re making a plan for the day, the week, or for 2019. The point isn’t to make all your decisions for the next 12 months, but to collect all the stuff you know for sure, you think might happen, and that you really want to happen in front of you so you can figure out your first step.

The exercise of planning is one of stretching the scope of your attention

After waking up with a tension headache I decided to do a gentle stretch session. Shit. It was intense. I was so tight, that every bendy direction given to me by the woman on the youtube was complete mockery.

“Just sit upright and walk your fingertips to your feet.”

… and I attempted to sit upright while my muscles trembled with the intensity of the stretch.

If you’re not a planner, trying to imagine the entire year or even the next month might feel a bit like that.

That’s cool. Planning is an exercise and slowly over time you’ll find that you’re able to stretch your attention further into the future.

Pick a time frame that doesn’t fill you with panic. Imagine a year, a month, a week, the next two days and wait until your brain doesn’t totally freak out.

That’s your time frame.

Sketching out your plan

There’s no wrong way to plan. Well… there probably are wrong ways to plan, but there are lots of ways to get the job done.

Just remember that the point is to help clear up whatever question you have in the moment.
One of the big questions that lots of folks (myself included) have is what can I afford? Can I afford to spend three hours a week working out? Can I afford to take two weeks off in May? Can I afford to go out for lunch today (both in time and money)? Can I afford to get a new place this year?

These questions are especially difficult for variable income earners who have a limited idea of how much time and money they’ll have over the next year.

So here’s how to start laying it down.

The important questions to look at are:

  1. What do I know for sure?
  2. What can I reasonably guess?
  3. What do I really want to happen?

We’re going to take a look at a few examples of how to play around with this. Remember… it’s play, it’s imagination, it’s not going to happen this way… but it could… and it’ll help us with the actual problem that we’re facing in the moment.

Plan #1: Figuring out the week

Question: Do I have the time for ________________?

This was a big problem for me at the beginning of last year. I kept over-committing to stuff and then things would get backed up and I would be stressed. I needed a plan, but I had never really blocked my time out in a systematic way before.

I used Google Calendars because I love being able to colour code blocks of time and it’s really easy to move things around. I can set it one way on Monday, and then shift things as the week goes along. The thing that really helps is that even though I’m moving things around, I’m really connected to the fact that if I move something… it has to bump something else.

To make my week plan I follow the same routine.

First, I block what I know for sure: appointments made, time I want to make sure to take off (evenings or mornings… booking rest time first is another skill I’ve learned this year), you can even put in sleep and meal time to make sure you’re accounting for that.

Next, put in the stuff you’re pretty sure will happen. It might not be confirmed, but you want to make sure to hold time for it. This is a combination of stuff that you want to have happen and stuff that you know happens every week. You need to shop, do laundry, and maybe shower… when is that going to happen?

And lastly, what do you have left for the stuff you want to do. This might be work projects or social stuff.

The thing I love about laying it all out on a dashboard is that I see all the things that are bouncing around in my head, and I can figure out really quickly whether I’ve overcommitted or if what I have planned is realistic.

A note: this might seem really overwhelming to some of you. You don’t have to do this every week. Remember…. a plan is a response to a question or tension in your life. Use it when you need to use it, but the more thorough your process, the more it will help.

Plan #2 Figuring out the next few months

Question: Can I afford __________________?

The same kind of planning can be applied to your finances. Yes, it’s hard to do when you’re a variable income earner and especially for those of you who have multiple income streams, but it doesn’t mean that you can’t patch together some kind of plan.

The list of questions is the same, and you can use this handy dandy tool to play around with them. It’s a variable income spreadsheet that helps you look at the next few months of your life (up to a year) in order to figure out if you’re spending too much or earning enough.

You can snag your own copy to play around with here, and the video below will let you know how it works. 

 

Plan #3 Figuring the year

Question: Can I take a two week vacation in ____________?

I love this exercise (which I stole from a mentor of mine) especially for the self-employed. It involves looking at the whole year and blocking out your vacation FIRST. And I’m not talking about the kind of vacation where you bring your laptop to a new city and then never leave the hotel room because you’re working the whole time. I’m talking about real vacation.

Here’s mine so far. I’m still working on it, but since I’m doing a lot of travelling this year it was really valuable to plan out days to adjust to the jet lag and block off real planned vacation.

Once I had this information I could look at the days I had left and math out the amount that I needed to earn per month in those days. Once I found a balance that seemed realistic I could feel better about starting to make plans for these vacation weeks.

Now all I have to learn is how to actually relax while on vacation. Sigh.

Plan #4 Figuring out the next 5 years

Question: Should I be saving? What for?

Okay. This one for you planning pros who want to stretch yourselves a little bit. It’s a technique that is stolen from the book Designing your Life (which is awesome and totally worth a read).

You can use it to map out your month or your year, but it’s really effective when you’re looking at a larger block of time.

They encourage you to draw out the next five years. What do you know? What do you want? What milestones do you expect to achieve?

But don’t just do one version… do THREE. One for the life you’re living right now, one for a version of your life that you would turn to if you couldn’t do what you’re doing right now, and one for a life that you would love to try if you knew for sure that no one would laugh at you.

Here’s one of their examples.

I went through this exercise late in 2018 and found it a difficult and rewarding thing to do, especially the second two versions. I found myself drawing a future where I was a 100% stay at home dad and one in which I was a cartoonist.

Both of those potential futures have become a part of my 2019 planning… which is pretty cool.

Don’t get lost in the weeds. No one knows what’s going to happen.

If successful planning was perfectly predicting the future there wouldn’t be a successful plan anywhere in the universe.

Planning is a game, an exercise of the imagination and a tool to help you figure out what to do next.

This year don’t get too bogged down in the product. Get your hands dirty in the process. Draw a picture, colour out some time blocks, and spend the imaginary cash of your future self.

And then make your next step a little more confidently.

Emily Nixon

Emily Nixon

Rags to Reasonable Community Outreach Coordinator

Emily Nixon is an actor/writer/director/filmmaking Swiss Army Knife. She is also a big money nerd and Community Outreach Coordinator for Rags to Reasonable.

She came to this work after becoming completely fed up with living paycheque-to-paycheque and being too afraid to look in her chequing account. She is passionate about empowering other artists and variable income earners to keep doing what they love and feel confident about their finances.

Email Emily at emily@ragstoreasonable.com

Want to start getting control of your money? How can I help?

EMAIL ME