Studio Economics

This is the yearly report to shareholders - except there are none - Profunk is a one person "dba." Nevertheless, it's a business, and maybe the info would be helpful to someone curious about all those "businesses that don't pay taxes" as recently reported in the mainstream press.

2008 has been tighter than ever. Automobile payments and credit card interest were looking too big, but I found a private "angel" and consolidated my debt at a lower rate. This freed up money to invest in supplies such as blank media, sax reeds, printer cartridges, security software for the computer. Previously, my occasional gigs were paying down credit card interest, and that wasn't feeling too good. Profunk is starting a new fiscal year with an incredibly tight operating budget, but it's not a deficit budget like before. The last two years have been profitable - but I would've lost money without the Bingtones!

When younger, I spent several years in the electronics industry - a salaried support role - not an executive. But I contributed the max to social Security for several years, so a few years back I took early retirement. This allows me to devote most of my time to my love of the arts. People ask me if I'm retired, I tell them I prefer to think "I've got my grant." Not as big as winning the lottery, but roughly equivalent to a $60,000 grant spread over 5 years. That's big to an artist!

I just turned 65, so now I have health insurance. I still have the musician's dental plan: "Chew on the other side of your mouth." I may be able to afford an eye exam soon (discounted through Anthem Freedom Blue I). And my Medicare initial checkup is scheduled in a couple of weeks.

After paying the rent, I have $620 a month for the business. In essence, the business is my life. But since I live in the studio, I'm only able to write off about half my expense on schedule C. The numbers add up quick. By using "88 card" for my long distance ($19 every 3 months), I keep my monthly communication bill under $45. I have 14 mile radius local calling, the slowest available DSL, and a messaging service that allows me to check my voicemail from any computer. I use AT&T even though I'm unhappy with their disrespect for user privacy and recent changeup on terms of their agreement. If I could find a better provider for the bucks, I would. Instead of an expensive cell-phone contract, I'm coat-tailing on a Sprite friends and family plan, "after 7 and weekends."

Water has been costing about $25 a month, and my auto/debt payment is $250. This leaves $300 a month for food, entertainment and gas for the Ford Ranger. At $4 a gallon it's $50 per fill-up, and I get 330 miles on 12.5 gallons, maybe 350 miles if I drive 55mph slow and turn off the engine at long stop lights. So I'm starting to figure in the gas cost on any gig offers, and the food and drink policy, too.

I can live on a $200 a month food and entertainment budget, but I have to turn down some invitations. And I can't afford to visit any clubs, unless I consider it a business expense. That's not so bad because at age 65 I have more concern for working on my backlog of recording projects than just relaxing at the local jam to see what random magic may occur.

Obviously, there are going to be other expenses. Auto insurance is about $800 a year, registration around $90, AAA Plus $84. Then there's oil changes, tuneups, brakes, tires. Long distance phone cards about $95 a year. KQED (PBS) membership $120 a year. $13 a month for Blockbuster: I get some great titles from their website - although Dr. John's piano lesson volume 2 seems to be on permanent backorder! Which is OK because I'm still working on lesson 1. I always check my bulk mail folder for something that will increase my reach to a tenth, but so far, nothing... But, I digress. The point is that I have to earn at least $200 a month for these extra expenses that will come up. The "grant" doesn't cover it all.