# Self employed artists: Getting a mortgage and other normal person stuff



## rahmalec (14 Aug 2018)

*Age*: 30
*Spouse’s/Partner's age:* 29

*Annual gross income from employment or profession:* Between 50k and 65k before expenses, 42k to 52k after expenses
*Annual gross income of spouse*: Around 20k

*Monthly take-home pay:* Tough to tell. Very variable

*Type of employment: e.g. Civil Servant, self-employed*: Self employed. A career in the arts hobbled together from lots of different sources. Mostly self employed but I am on the payroll of around 5 or 6 employers as well (mostly colleges where they'll register you as an employee even if you teach there one day a year).
Partner teaches performing arts 3 days a week in various after school places

In general are you:
(a) spending more than you earn, or
(b) saving?
Probably saving, but just had a big wedding.

*Other borrowings – car loans/personal loans etc: *No debts

*Do you pay off your full credit card balance each month?* Yes, but hardly ever use it

*Savings and investments:* around €25k, another 8k or so in another account but that's for the tax bill

*Do you have a pension scheme?* No

*Do you own any investment or other property?* Equipment I use for my work. Worth at least 50k

*Ages of children: *none

*Life insurance*: none


*What specific question do you have or what issues are of concern to you?*

We are both self employed and work in the arts. In particular, I earn what might be a very averayge amount compared to what I've seen lurking on these forums, but it's a fortune compared to what most of my colleagues make. I feel very lucky in that if I won the lotto, I'd still show up for work in the morning but unlike many others I know, haven't had to trade this for financial hardship. Don't get me wrong, I have had to work hard and I'd be one of the best in the country at what I do, but simply put, there isn't money in the arts to demand raises. As I get older I will probably get more into teaching.

We recently got married and would like to eventually do some "normal person" things, like get our own home, save for retirement, etc. Thing is, most of my friends and colleagues would be a lot more clueless than even myself about these things, so decided to ask here.

- *Mortgage*
I'm a bit scared of this. Is it even possible with our working situation? Nervous about approaching any financial institution where "conventional wisdom" seems to be a given. I know it will be a long road getting a mortgage as a self employed couple, even worse that our work is pretty unconventional and most people wouldn't associate "financially prudent" with my profession. What would be the best way to go about this? Best things we could do in say, one or two years, bar getting a real job, to make things look good for anyone we approach?

As for earning more money, I could probably hustle a bit more. Partner could take on extra hours too. For myself I already work quite a lot and am away from home a fair bit too. It would probably just be diminishing returns to do more.

- *Saving and budgeting*
What has served me well so far is to have a small reserve fund so that we can dip into in dry periods. Then I would do a rough budget for 6 months, overestimate every expense and underestimate income. Meant I always had more than I thought I would and never went into trouble if something like a holiday went over budget. If we're to get more bang for our buck, I presume there's a better way to do this.

As for saving, yes our wedding was expensive (in fact, advice I would give is whatever you think you will spend, multiply by 2!), but we saved a lot over the last year and a half and paid it all ourselves. We now have 25k in the bank, mostly from presents and will not be touching it until we need it for a deposit (one day). Will begin adding more from next month. Any advice on how much we should aim for?

- *Pension*
Neither of us have anything. Haven't a clue here. Should we start one? I presume yes and asap?


Thanks for reading


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## Sarenco (14 Aug 2018)

Hi @rahmalec

I don't think you should be at all nervous about applying for a mortgage when you are good and ready to enter into such a commitment.

Most lenders will require three years worth of business accounts, evidence that you have no outstanding tax issues and, most importantly, evidence that you will be in a position to actually meet your repayment obligations as they fall due.

The key is to remain disciplined, which shouldn't be an issue from what you have told us.

Maybe give yourselves a target date - say, three years from now - when you will have built up savings equivalent to at least 10% of the value of your target property (over and above a chunky cash reserve, which I agree is important in your circumstances) and "clean" (as in readily explainable) accounts.

Personally, I think you could prioritise saving for a house deposit over making pension contributions for the time being - others may well disagree.

Hope that helps.


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## Purple (15 Aug 2018)

Are you renting at the moment?


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## rahmalec (15 Sep 2018)

Sorry I haven't said anything until now. Thanks for the replies so far.

We actually went in to an advisor couple of weeks ago and it wasn't as scary, or as bad as I thought it would be, seeing as we have no debts.
The painful thing will be to maximise our income on our tax returns, which means cutting out expenses!

Purple, living with folks at the moment. If it's feasible for us to apply for our own place in the next 12 months, then we'll say here, otherwise will rent somewhere for a while.


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## Brendan Burgess (16 Sep 2018)

A pension is absolutely not a priority for you. Forget about it until you have bought a home and have got the mortgage down to a comfortable level.



rahmalec said:


> *Annual gross income of spouse*: Around 20k





rahmalec said:


> Partner teaches performing arts 3 days a week in various after school places





rahmalec said:


> Partner could take on extra hours too.



You have a decent income but your spouse appears to be a hobbyist.

I have no problem with people working at their hobbies, but if you want to do "normal" things like buying a house and having children, you have to have money.

Why does your partner not try to get a job with a proper income.  Even if they do it only for a few years to get the deposit together.

It's ok in your 20s to live with your parents and live the dream of teaching performing arts.  But in your 30s you should be earning money.

Visual Artists Ireland has good resources for visual artists. Is there a representative body for your branch of the arts?  

Brendan 

Brendan


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## Purple (17 Sep 2018)

rahmalec said:


> Purple, living with folks at the moment. If it's feasible for us to apply for our own place in the next 12 months, then we'll say here, otherwise will rent somewhere for a while.


What do you mean "apply for our own place"?


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