10 Financial Tips
That Can Save Photographers Money

I always keep in mind that there are only two ways to make money in business – raise your income or decrease your expenses. It’s easy to forget that sometimes we have more control over our expenses than our income. Here are 10 financial tips that can save photographers money and have worked for us!

1. Track Your Expenses Use online tools to track your personal spending (mint.com), your business spending (quickbooks.com) and your net worth (personalcapital.com). Mint and Personal Capital are free, Quickbooks online is $10-20/month. Challenge yourself with goals to spend less and save for the future. Start meeting with your partner to make it a challenge you both can push toward and enjoy.
2. Purchase Equipment Wisely
   * Don’t purchase the latest model cameras and flashes unless there’s a huge reason (like the introduction of two card slots). Buy new but one model ago. For example, when the Canon 5D Mark IV came out (currently priced at $3299), we bought the Mark IIIs (currently priced at $2385).
   * For back-up equipment, buy used…if you ever need to use it, it will probably only be for one job.
   * Don’t buy more that you need…when you are starting out, you can shoot everything you need with a 24-70 and a 70-200 – but buy the best lenses you can afford (or rent them until you can purchase them)…you will have them a very long time.
   * Don’t switch systems if your current one works fine (mirrorless, everyone switching from Canon to Nikon because Nikon momentarily had a better camera, etc.).
   * Do choose brand name cameras and lighting.
3. Leasing Lease equipment until you can afford to buy and continue to lease if it is something that will be obsolete. Lease Lightroom, Quickbooks, a lens you may only need for one job. Lease to try out equipment.
4. Buy used cars! Peace of mind from a lack of debt will bring you more happiness than a new car! “The value of a new vehicle can drop by more than 20 percent after the first 12 months of ownership. Then, for the next four years, you can expect your car to lose 10 percent of its value annually.” – Carfax. While we can afford not to, we drive a 15-year old, fully paid-for, Ford Focus and a 10-year old $10,000 fully paid for Toyota Highlander while people in debt all around us are driving $40,000 cars. When buying a new (used) vehicle, chat with your accountant about whether one of your vehicles can be purchase by the company so that all your gas/maintenance/taxes and the purchase can be written off. At the very least, track the mileage of your existing car when you use it for business so that you can deduct it. Remember writing off $1 can equal $0.20 to $0.30 (depending on your tax bracket) back in your pocket if you deduct it. That’s 20-30% off everything you purchase in your business!
5. Start a retirement account NOW. Open up a brokerage account with E*trade or a similar brokerage and start “dollar cost averaging” which means set up an automatic deposit into your investing account of the same amount every month. Common retirement accounts for small businesses include Roth IRAs, SEP IRA, Simple IRAs. You can do a quick search online to find out the differences or set up a free call with the brokerage account to explore options. It’s very important to start learning about finances yourself and not relying on someone else to take care of it. If you start saving in this manner, as you grow older you will have years where you make more money from your investments than from photography!!!!
6. CREDIT CARDS. IF YOU ARE VERY DISCIPLINED, use a credit card for all your personal and business expenses but PAY IT OFF IN FULL EVERY MONTH. You can set up a business credit card and a personal credit card that build points toward the same account. We just received 3 out of 4 plane tickets to Vietnam for free because of credit card points….that’s worth almost $3600. I like The Points Guy https://thepointsguy.com/guide/beginners/ to evaluate different cards.
7. Small Business Line of Credit Have seasonality to your business? Putting slow months on your credit cards? This can mean disaster pretty quickly with high credit card fees. See if you can get a small business line of credit from the bank…the interest rates are much better. We received a $40,000 small business line of credit when we opened the studio as we knew we’d need some up front capital in the winter to build out the studio. JUST DON’T SPEND IT IF YOU CAN’T PAY IT BACK. Can’t get approved because you are too new and have no track record? Cut your spending to pay off your existing debt. When paid off, take those payments and put into a savings account for the next off-season or business investment.
8. Kids on Payroll Get your kids on payroll! Yes, they have to work too but can be paid to be models even as young as 6. Additionally, set up a Roth IRA for them. They can use it for college penalty-free or grow it to retirement. We stopped using our state’s 529 College Saving Plan and switched to this method once we learned about it. Ask your accountant if it makes sense in your state. Here’s a great article on the topic: https://www.marketwatch.com/story/the-new-tax-law-makes-hiring-your-kid-a-better-idea-than-ever-2018-06-04
9. Write off Healthcare. As a business owner, you should be able to write off some of your healthcare either through an HSA or a Medical Reimbursement Plan…either your out-of-pocket expenses or out-of-pocket plus premiums. Discuss both with your accountant. Health premiums killing you? As a healthy family of four who wasn’t eligible for the subsidies, we went from $600/month premiums to $1200 with Obamacare. Last year, our premiums were going to go up to $1800/month so we opted out and went to Liberty Healthshare…a healthcare co-op. So far so good at $550/month, but you are limited with pre-existing conditions.
10. Don’t quit your day job until… Don’t quit your day job until you know you can cover your minimum personal expenses. This will only cause you great stress!!!! Want help figuring out when you are ready? We’ll be covering that in detail in a future course we are creating. Click here to be notified when it’s ready.