One initiative that I have been involved in, over the last few years, is that of developing investment plans for artists. Successful artists often get to earn considerable sums of money from their arts. But this is usually for a limited amount of time. After a while, all artists lose their luster. So the expectation is that the artists will have invested a bit of their earnings during the ‘good times’, to see them through the ‘hard times’ that are almost certainly bound to come, once they stop being the ‘top stars’.
Artists who don’t understand the transient nature of their success often end up in great difficulties. It is not uncommon to encounter a fellow working at Walmart, and therefore having to go through the Walmartone login screen to access a meager weekly paycheck: yet, just a few years ago, the fellow was swimming in money, thanks to a thriving artistic career. Yet, with proper investment plans, it is possible for artists to avoid ending up in such dire circumstances.
In developing proper investment plans for artists, there are several factors that we take into consideration. Firstly, we look at the percentage of their incomes that the artists are willing to invest. We often encourage the artists to invest the highest possible percentages of their incomes. Of course, the artists tend to be folks who love the ‘good life’, and in some cases, what they are left with for investment purposes (after spending quite a bit of their money in financing the ‘good lives’) is usually very little.
Another key factor we look at, when developing investment plans for artists, is that of the specific assets to invest in. Here, we have to look at the expected returns, as well as the levels of risk exposures the artists are willing to take. We are also careful to ensure that the artists end up with a diversity of investments: such that, if one class of assets fails to perform well, they can have something else to fall back on.