Retirement planning for photographers
Arrange the future you deserve
Preparation Always Matters
As a photographer, you know that preparation matters. Set the right equipment in the right place at the right time, and you’ll see the results on the camera. The work you do now saves more work later.
Retirement planning requires the same discipline. The more you prepare now, the bigger your retirement income will be in the future. At Due, we keep it simple. Save each month and earn 3% interest, with no hidden fees, all the way to your retirement.
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What Is a Retirement Plan for Photographers?
Focus on the Shoot, Not Your Taxes
Why choose Due for your retirement fund?
You can’t control natural light. Subjects have their own minds. And as for clients, they know what they want… until they don’t. One thing you can control is your retirement. Whether you’re a staff photographer making the most of a 401(k) plan or self-employed with only your own savings to fall back on, you should have your own retirement fund. Due gives you an easy, predictable way to put money aside for your future.
Applying for an account is free and takes about two minutes. In less than the time it takes to check the light and adjust your settings, your retirement plan can be up and running.
takes less than 2 minutes
ULTIMATE GUIDE TO LAUNCHING YOUR OWN
The U.S. Bureau of Labor Statistics anticipates that the job outlook for photographers is expected to increase by just 4% from 2012 to 2022. The main reason for this slower than average growth is because companies are turning to freelance photographers as opposed to still hiring an in-house photography. That stat, however, shouldn’t deter you if you have a great eye and passion for capturing a story or event. A career as a professional photography can be fulfilling both creatively and financially – even as a freelancer.
Chapters - Photographer
If you’re a staff photographer and your employer offers a 401(k) plan with matching contributions, you should save enough each month to take advantage of all of those contributions. Save less, and you’ll be leaving money with your employer that could be yours. Saving enough to take all the matching contributions should be your baseline.
Freelance photographers won’t have matching contributions but they should aim to save enough to be able to live on 4% of their total savings one day with help from Social Security.
Calculate the amount you think you’ll need to live on each year, deduct your expected annual Social Security earnings, and multiply by 25. That’s your savings target. If your current savings rate won’t get you there, you’ll need to save more funds each month.
Retirement funds come in a variety of different forms, with different benefits and different advantages. At Due, we offer annuities, pensions, and 401(k) plans. While 401(k) plans are best used by employers looking for a way to help their employees, there are versions available for self-employed photographers and for photographers who subsidize their income with occasional freelance work, stock sales, or print sales. Annuities let photographers swap a monthly contribution or a lump sum for a monthly payment in the future. Pensions give a fixed return.
All of those plans will suit a photographer, whether they’re staff, freelance, or partly self-employed.
Photography is hard work. It can mean lots of travel, plenty of frustration, and no shortage of early mornings standing in the cold waiting for the sunrise. But it can also be hugely rewarding. Few jobs deliver the kind of satisfaction that a beautiful shot can bring. Photography is the sort of activity that other people retire to spend more time doing.
If you’re on staff, you might look forward to a retirement that still allows you to continue shooting but on your own terms. You could retire early, take a smaller distribution and supplement your income with stock photography or art sales.
The age at which you retire, though, will affect the size of those distributions.
Any distributions taken before the age of 59.5 will come with a penalty. Delaying Social Security after the age of 62 adds 8% each year until you start receiving payments at the age of 70. At the age of 70.5, you must start receiving distributions from any pre-tax retirement plans.
The right age for you to retire is up to you. It will depend on how much you want to live on, and how much work, if any, you want to do after retirement. But be aware of how much you’ll reduce your income for each year of early retirement.
Yes! You’re in charge. We get that photography work can be unpredictable. Freelance photographers can find that their income varies from month to month, depending on the frequency and the size of assignments. Staff photographers will often supplement their incomes with freelance assignments and stock sales which can rise and fall.
You can reduce your contributions to Due between assignments and raise them if you land some big sales. Just make sure that you check your account and stay on track towards your retirement goal.
You can always continue working after you’ve retired. But you want to be sure that the choice is yours. When you reach retirement age, you want to be able to choose whether you want to spend your time corralling formals to pay the bills or shooting icebergs for fun. Save enough to be able to enjoy your retirement, however you want to spend it.
Only if you’re going keep photographing part-time. You can’t take Social Security until you’re 62, and if you take 4% of your fund in distributions each year, you’ll have an annual income of just $12,000 a year. You’re still going to have to put in a lot of professional photography each week.
No one is good at saving! The average American family has about $40,000 in liquid savings. Between the ages of 55 and 64, those savings rise to $57,200, and reach $67,700 between 65 and 74. People with higher education tend to save much more but no one saves enough, and with the average salary for a photographer little more than $36,000 a year, it’s too easy to spend now and hope for better times in the future.
Saving for the future means taking control now, creating a habit, and sticking to it.
A savings account at a bank will now barely earn enough to beat inflation. It’s unlikely to pay enough to compound and turn into a pot large enough to pay for your retirement. Contributions to retirement funds are also tax-deferred. You can make your contributions with pre-tax dollars and pay no tax until you retire.