Should You Take Out A Loan For A Studio or Musical Instruments?
A musician cannot perform without instruments, and a studio engineer cannot record without studio equipment. Taking out a loan from Direct Lender homepage may be a helpful method to get things started.
When Is It Appropriate To Borrow?
The easiest method to manage your money and get the stuff you need is to practice delayed gratification and purchase when you’ve saved up the necessary amount. Also, keep in mind that many individuals sell instruments, amplifiers, and studio equipment in a bad economy, so now is the best time to look for discounts.
However, there are a few situations in which borrowing money is a good idea:
- When you have a series of paid performances lined up. For example, your performance schedule for the next month is wholly scheduled, and all of the events are profitable, but you don’t have a guitar with which to perform. You could rent a guitar for this period, and it wouldn’t be too expensive, but if good earning possibilities start coming your way, you might want to put the guitar on a payment plan to keep that momentum going.
- When you’ve recently landed a big session playing a gig. If you’re going on tour with Taylor Swift or someone like that, now isn’t the time to be concerned about paying off debt. However, if you’re in that circumstance, you may talk to the tour manager about getting an advance or deducting it from your income.
- When clients are lined up to record with you at your studio. This is a potentially dangerous situation, so proceed with caution. Let’s pretend you’ve recently booked several more clients at your studio and need to update your studio monitors to accommodate them. You should be able to pay off those monitors faster now that you have cash flow than if you didn’t have any leads or clients.
There may be additional circumstances in which borrowing is a good idea, but it all boils down to whether or not you have cash flow. If not, don’t waste your time. Let’s have a look at a few different funding options.
Take out a credit card.
Let’s face it: most banks will not help you finance your musical endeavors. They rarely give loans to persons who haven’t had consistent income for the past five years, don’t have sellable assets, and don’t have co-signers, much alone musicians.
Meanwhile, consumer debt is socially acceptable, and when you use a credit card to fund things, no one will question you about what you’re spending the money on. Unfortunately, interest rates will be sky-high, and if your credit score isn’t outstanding, you may get sucked into poor agreements without even realizing it. You can make minimal payments endlessly, but you’ll only be feeding the consumer debt monster. Using a credit card to finance musical equipment is a popular practice, but it is rarely, if ever, the ideal option.
Draft a business plan and seek funding from traditional sources.
Imagine you want to start from the ground up and build a recording studio. You want to acquire a building, refurbish it, add soundproofing, and invest in recording equipment. I’m not sure why you’d take that risk in this day and age (more and more musicians are opting to record from home or in a home studio), but credit cards and in-store financing aren’t going to cut it for anyone looking to make larger purchases.
The first step is to write a detailed business plan that outlines what products and services you’ll offer. How much you’ll charge for them, your projected revenue for the next five to ten years, who your competitors are and how you’ll compete with them, how you’ll market and promote your company, etc.
Whether you are a musician or a music producer, you are a business, and you can set yourself up as one. It’s time to look into traditional sources of loans, finance, or investments once you have your plan in place, your business registered, and the wheels are in action (i.e., you’ve started executing on your project). Venture funding, angel investors, bank loans, grants, and so on are all options. If I’ve given you the impression that obtaining funding from these sources is simple, you’re mistaken.
If you have many supporters who are willing to help you out with small amounts of money, crowdfunding may be a better option. However, you can’t rely on credit cards, 401ks, in-store financing, or savings to get your business off the ground if you need a greater sum of money.
Your problem-solving abilities will need to be improved.
Many people seek immediate gratification, but I believe that it is best to take the long view in matters of money and business. Maybe you won’t be able to save enough money in a few months to get your business off the ground. But what about a few years from now? There’s no need to hurry the procedure. If you can pay for it in cash by saving for a few years, you may use that time to brainstorm new methods to make money (to expedite the process) and research what it will take to establish a business after you’ve saved enough money.
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