This session on the LDI TechTalks Stage, moderated by Rachael Bronstein, a financial coach and the founder of Life’s Jam, and provided real-world strategies and straightforward money tips. Bronstein was joined by Samara Goldhecht, B Party Tour Manager and Accountant for The Lumineers, Emily Waller, Production Manager, and Jonny Steigler, Cofounder of The Beehive LA.
While life on the road can be lucrative, it can also be financially unpredictable and confusing. Freelance work offers freedom and interesting jobs, but few of the benefits of a steady job, such as retirement contributions and a steady paycheck.
All the panel members were money conscious from the beginning of their careers, but there were some nasty surprises. Rachael Bronstein walked through some of the challenges and solutions of life on the road.
Rachael Bronstein: How did you handle taxes at the beginning of your careers?
Emily Waller: When I started out I was paid in cash so I was shocked when I saw how much taxes were. Now I put aside between 25% and 30% of earnings to avoid any nasty surprises at tax time.
Jonny Steigler: I thought I was doing very well until tax season arrived and I had to pay all of it!
Rachael: Too many people in this industry end up on IRS payment plans because they don’t put enough money aside or don't pay estimated taxes. Taxes on the road are not the same as for people who are paid in one state.
Samara Goldhecht: It is important to find someone who understands, for example, per diems are different in every state.
Emily: I am freelance and having a tax adviser is WELL worth the investment.
Rachael: One of the money stories we tell ourselves is that you have to be wealthy to have a financial advisor, but it is not true. You can find a professional for taxes or investments or you can go to a bank or other institution and set up a brokerage account yourself.
Rachael: So money means different things at different times, when you are away from home does it help you feel like you fit in?
Jonny: Yes. If a big group of people are going out you are not going to want to be left out.
Emily: The FOMO is real. But also, days off are when you network and talk to the technical manager and production manager. You can’t talk to them on a show day and networking is how you get gigs after the gig you are on. So sometimes going to the restaurant is the price of admission, gigs don’t magically come to you.
Rachael: Do you spend more money at home or on the road?
Emily: On tour I try to live on between $60 and $70 a day. I spent a lot when I was touring in Europe because it was new. Now, I find a balance between going out in new cities and staying on budget.
Johnny: Finding moderation is good, you don’t want to over save and not have fun on the road. I definitely spend more on the road, there is a temptation to go to a nice restaurant.
Rachel: The road is hard because convenience is expensive and a lot of times you are tired.
Samara: I bought a new house two years ago and so I'm always about spending on the house. I spend less money on the road because I’m not thinking about which rug I need for which room or art for the walls.
Emily: Once I spent a lot of money taking the crew out to dinner. We’ve all been on tours where the routing sucks and the situation isn’t optimal so doing a bowling day or something can help people's attitudes. On this tour there was no budget to do a crew dinner and I really just wanted people to have a night out so I just handed over my credit card knowing I couldn’t pay it off immediately. But it was worth it. Even bus beers go along way to keep the team happy.
Rachel: Do you think about the year ahead?
Emily: I try to prioritize things like mental health and going to the gym if I'm home in January and February, when I'm not actively putting myself out there for gigs. But if something comes along I will take it.
Rachel: A lot of people think they can’t afford downtime.
Samara: It is SO important to save money for six months of expenses because you just don’t know when there will be a lull. The 2010 financial crisis really affected touring and then Covid happened, so you need savings. You can build it up over time, every week before I got paid I move everything left over in checking into a savings account.
Emily: Yes, even if it is a dollar, it is better than nothing and it will grow over time.
Rachael: I don’t necessarily see it as an emergency fund, I see it as cash reserves so we can spread out our money because of the work schedule.
Rachel: Do you know what you will be bringing in for the next year?
Samara: The first time I applied for Obamacare they asked how much will I would make next year and I had no idea. Now, of course, I think I could tell you because I know what my rate is.
Jonny: A few years ago I was buying a house and the bank said you technically don’t qualify because I had both W2s or 1099s. You are better off being on a low W2 just for consistency. My paperwork showed I made money, but not with consistency, and I couldn't prove how much I would make the next year. I was eventually able to get a loan but it was not automatic.
Rachael: How do you save for retirement?
Emily: I started a Roth IRA and I max it out every year. Once it is maxed out, I don’t have to worry about it for the rest of the year. As an independent contractor I use a big tour to cover the expenses for the year, and then any festival or one-off show I use to build up money.
Jonny: The best advice is to put yourself on payroll, even if you are freelance, so you set up your own 401k and make sure a percentage of my earnings goes to myself and a percentage goes into a 401k. That takes the stress out of it. I had to create it for myself.
Samara: When I had a desk job I had a 401k, then I went on the road it was just a free-for-all. When I went on the road I set up my own 401k.
Rachel: Make sure your money is invested! Not just sitting there. And protect it, if you are traveling you can miss a call from the bank and not realize something is wrong.
Samara: I am always looking at my credit score.
Jonny: I am always checking my banking app.
Rachael: Did you know you can freeze your credit and there is no harm to your credit score? It prevents someone from taking out a loan in your name and there is so much identity theft these days. The easiest way is to go to the three credit bureaus and freeze it, and then when you want to take out a loan or get a new credit card you can go back in and just toggle it on again.
Best Tips For Managing Your Money
Samara: Start with a high yield savings account and make it a priority. If that is set up so you don't have to think about it helps your brain focus on everything else.
Emily: Self accountability. Money is a sensitive topic but we deal with multimillion dollar budgets for tours every day and if we are managing that for others we should be able to focus on our own budget. I write down my goals, like paying down my car loan, and at the end of the year I go through that list and see which of the goals I accomplished and if I didn't then why.
Rachael: Monarch or Mint or any other app - it doesn't matter which one, apps are very good for tracking expenses. And setting up automatic payments to your retirement and savings accounts. Choose an approach you can live with.
Audience Questions
Does Your Rate Fluctuate?
Samara: If you have a two-year tour you can come down a bit for a steady job. If it is a two-week tour you need to make more money.
Emily: I have a day rate, but I ask what the budget is and I have a range which depends on how much I want the job and what my schedule is like and who else is on the team.
How do you negotiate for more money with a client you have worked with for a long time?
Emily: It is nuanced. You have to be transparent but you can negotiate at the end of a cycle, for example, if you do the tour and then they add on festivals you can go back and renegotiate for those. And if you love the camp you have to tell them, "Here’s what I would like to be making because I get that elsewhere, do you think that is achievable?" Be transparent.