Retirement for Musicians

(How To Do It)

By Mike Vaccaro
(from Mike's Musings #24, our newsletter)

While it hasn't always been that way, my number one mantra to my students, my friends, or to you in these little musings, is to SAVE YOUR MONEY.

Why is that important? Simply stated, it is because if you are lucky, you will retire, and if you treated yourself well, you may even retire active and healthy.. Either way, you will need money to enter the last couple of semesters of your life.

Do you have an idea about when you want to retire, and how you want to live your life after your years of work? If so, the time to launch your plan is the day you start your first job. You may even have some money from childhood savings or odd jobs.

I was not very good at saving until I turned 50 and suddenly realized that I was going to retire at some point, if I stayed alive (assume that you are going to stay alive). Along with a small inheritance, the Musicians Pension Fund, and saving (after 50), I was able to retire comfortably. Oh, and there was also the Musicians Special Payments Fund for residuals that helps.

I was lucky. I was always a union guy. I know that’s geeky now days. What it did though, was to save money for me, without my having to think about retirement.

It’s not quite that way anymore. Unions are on a downward slide. Employers want more money. There are too many talented people in almost every field, so employers can hire people for less, because of competition. And then there is technology, which eats a lot of jobs as well. So now each of us, ...well you... have to take care of yourself.

I hope that each of you is able to find a bunch of free money for retirement. But if you don’t have that, it is time to be serious about saving, perhaps investing, or perhaps judiciously buying property that will appreciate. I think you know what I am saying. Don’t wait until you are 50 years old like I did.

Even if your family has money, and you expect to receive some or all of it sometime in your life, it is still important to save money. Why? If you believe “we are what we do on a daily basi”, then the art of saving will make us rich or at least relatively rich. That is, rich enough to make at least what we were making when we were working.

The piggy bank we all had as children was a good lesson in saving, for the few of us who paid attention to it.

With the influx of a younger and more educated workforce, there is increased competition. Not only that, but also there are also personality clashes that come with any type of job. These have to be approached with a smile and a willingness to compromise whan one is able to.

We must realize that ALL jobs are political, even in music.

In music, as in any occupation, there are parts of the job that are less fun than others. Those parts of the job can become tedious, but we must persevere to get to the parts we love.

The future comes sooner than we think. Why? Because we are busy and energetic. We can keep up with the pace of modern life and work 16 hours a day, have a family, and a lot of fun too. As we age, like an old car, the parts of the body start talking to us, and our youthful injuries revisit us. It's more difficult to keep up with the pace of life. The world is moving faster than we want it to. A retirement plan allows us to slow down our pace naturally, at a time of our own choosing,  and look more closely at what is important.

Not only in the music arena, but in many disciplines, including accounting, schools simply do not teach about money management, career development, or saving methods for retirement. Young people are left alone to figure it out, or, if from a wealthy family, study firsthand how it is done. Saving or attaining wealth for a comfortable retirement is something that must be monitored on a regular basis. It is as important as practicing for musicians.

This may mean giving up unnecessary “treats” while paying oneself first to ensure a continually growing nest egg. We live in a world of excesses in the United States, with advertisers badgering us from every angle. This can be avoided if we live simply. How many of us have a garage full of things we bought, that we will rarely, if ever, use? Skeletons of our past, and/or current buying habits. Speaking of unnecessary treats, using drugs and alcohol in excess slows us down and takes up important money for our future. It freezes us where we are when the habit becomes in full bloom.

My music teacher, a professional freelance musician, always used to tell me: “Pay yourself first." It makes sense to pay yourself before you pay your bills. Take a percentage of your earnings (10% sounds good) and put that amount away EVERY time you make money. By cash or check. You will be amazed how quickly you find your nest egg increasing.

The banks and credit card companies don’t care how much you pay on your debt because that's how they make their money. If we think of the credit card, and credit in general, as a convenience card, pay it off monthly, and generally keep a zero balance, all the interest we would have paid is savings to pay ourselves with. We don’t have to skimp. We just have to not waste. Seems like pretty good plan for retirement.

Another young lady, advanced for her age, told me, “keep your overhead low.” This is another way of having money to save. Along with pay yourself first, this is the best information I ever received. This is truly the art of saving. Another good plan? I think so.

In music, and many other fields, most of us are independent contractors, so it makes sense to keep our overhead low. Many of our employers and much of government hope that we are all independent contractors, as it makes their life easier.

If we are musicians, we have big investments to make in instruments, the tools of our craft. If we have to use credit, it's better to use a commercial credit institution than a credit card. Use credit wisely.

One thing we haven't discussed so far is health. If you can take care of your body by not participating in radical sports, and if you can eat in a healthy manner and stay away from abusing alcohol and drugs, those are other ways to save money,. As you well know, medical care is very expensive these days.

So now what?

We are retired. We are most likely as busy as we have ever been. But we have the opportunity of doing what we want. We may even retire early while the body is still near its zenith.

That doesn’t necessarily mean that we will stop working or stop being involved in anything important to us. It means we won’t have to do the things at our job(s) that we really didn’t like to do.

The angst of having to make a living will be over.

You have the choice of becoming, or remaining, an active participant in Life.

OR, you can sit and watch TV all day...either way, the choice is yours, and you'll have enough money to support your choice.


Either way the choice is yours

That is simply what all the talk of overhead, health, and savings is about: Retirement.


Some Quotes From My Journal

No one may succeed in life without saving money. There is no exception to this rule, and no one may escape it.

~Napoleon Hill

To do much clear thinking, a person must arrange for regular periods of solitude, when he can concentrate and indulge his imagination without distraction.

~Thomas Edson

An aim in life is the only thing worth finding, and it is not to be found in foreign lands but in the heart itself.

~Robert Lewis Stevenson

If you cannot do great things yourself, remember that you can do small things in a great way.

~Napoleon Hill

We fear most which never happens.

~Napoleon Hill

The best compensation for doing things is the ability to do more.

~Napoleon Hill

Success is largely a matter of tactful and harmonious negotiation with other people

~Napoleon Hill

Accept the trauma of truth.

~Jim Rohn

Some more thoughts from Jim Rohn:

Experience translates into value

Be thankful for what you already have

Cynicism shuts the door to new ideas

Be eager to learn

Be a good listener and give extra attention to a voice of importance

Casual approach gives casual results

Turn frustration into fascination

Nothing works every time

Have treasures of the mind

Take notes

Read because you must