Watch Your Money: Budget Breakdown for a Content Creator Making $200,000 – BET | Gmx Pharm

Profession: Content Creator at AliciaTenise.com, author of the book From Harvest to Home

money shift: Money management while working as an independent contractor

The life of a top lifestyle blogger like Alicia Tenise Chew from AliciaTenise.com can be fabulous indeed – sponsored trips, media attention and book deals. However, it also has a side that is rarely talked about.

“One thing about blogging is that you don’t get your paycheck every two weeks,” said Chew, 32. “Some people pay you in a net 30 time frame, and unfortunately some payments are five to six months overdue. As a blogger, it’s always a bit unstable.”

Now, Chew wants to put as much energy into having a thoughtful financial life as he does into curating the perfect style shoot. “My partner and I travel a lot,” said Chew, whose partner is a food and hospitality photographer. “When traveling there are always some out-of-pocket expenses. When we come home we are so tired and order from UberEats.”

Chew started blogging in 2011 while working in the fashion industry. She decided to start an independent outlet to express her personal style.

After completing her 9-to-5 job, Chew was blogging at AliciaTenise.com at 5 a.m. She built her Alicia Tenise brand and made $40,000 a year from it, but she wasn’t ready to quit her full-time job just yet.

“The thought of being a freelancer was really scary for me,” Chew said.

In December 2016, Chew was fired from her job and received a severance package that covered three months of her expenses. She decided to blog full time.

“I’ve been able to make more money from the blog because I’ve had more time to devote to projects and the quality of my content,” Chew said.

Blogging became her job. “I love the community I’ve created,” Chew said. “It’s so cool to have people by your side every step of the way. I never expected to have all that.”

Last year, Chew and her partner relocated to Los Angeles after setting a goal of saving $10,000 in eight months for the expensive overland trip from their Virginia base. The move turned out to be the right one. Chew says she would like to pursue television opportunities in Los Angeles.

“I don’t think I’m going to[blog]my whole life,” Chew said.

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Chew makes just over $200,000 a year. Chew has $7,000 in credit card debt and $12,000 in student loan debt. A literal fly girl, her travel lifestyle doesn’t leave her much time for cooking. Chew sometimes only has three to four days between trips for her blog and spends between $350 and $400 a month on food.

Her main output is photography. She can spend anywhere from $100 to $15,000-$20,000 on a photo shoot for her brand. On average, she pays $500 per shoot. She rents studio space and/or buys props.

Chews spends around $2,900 a month on rent. Utilities are included.

Chew has a high-yield savings account.

“Sometimes I put in $500, or sometimes I get paid late and can’t deposit,” Chew said.

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As a lucrative personal brand, Chew needs to build its own personal board, said Alleson Tate, a board-certified financial planner and owner of Avere Wealth Management in Atlanta. According to Tate, people of Chew’s level need a good accountant, tax strategist, financial advisor and lawyer.

“These people will help her get organized, give her a solid strategic plan, minimize her tax liability, maximize her company’s profitability, and give her a solid foundation as she expands her empire into television,” Tate said.

Here’s Tate’s other tip:

The great thing about being a content creator is that a lot of her lifestyle is a write-off. The key is to keep good records. For example, when planning a photo shoot. Cameraman, behind-the-scenes videographer, location, on-set meals and more are tax deductible. To track expenses in your business, consider apps like QuickBooks or Expensify.

Creating a spending and savings plan can be difficult, but there are many great tools out there. Undoubtedly, the most popular app is Mint. People can connect their bank accounts, credit cards, bills and other expenses to the platform. It is a data aggregation tool that categorizes each transaction like clothes, eating out, etc. Other apps to consider are YNAB, EveryDollar, HoneyDue, and PersonalCapital.

If she has to eat out, consider alternatives such as The average price per meal is still cheaper than using Postmates or going to a restaurant. Chew should also consider making a little meal on the weekend or during her free time, then putting the food in the freezer and taking it out throughout the week when she’s out.

If she is the main breadwinner in the household, she should consider disability insurance. They are more likely to be disabled than to die, and long-term disability insurance protects them during those critical earning years. While coverage can be expensive, age is on your side.

As a company, it has to pay itself first. You might consider forming a SEP IRA. She can contribute 25% of her compensation up to a maximum of $61,000. She receives a deduction for contributing to the SEP IRA, which reduces her taxable income.

If she’s consistently making $200,000 a year, an LLC may not be best for her from a tax perspective. In an LLC structure, you pay 15.3% in self-employment taxes. Under the S-Corp structure, she pays herself a salary. She is only responsible for the payroll, takes her salary, not the rest of her income. If she can sustain herself on a $50,000 salary, she should consider an S-Corp.

Now there are other considerations such as the cost of filing an S Corp statement separate from reporting income from an LLC flowing through its 1040. There are also some additional administrative costs to consider. She needs a good tax planner to determine the potential total cost savings of changing corporate structures.

Natalie P. McNeal is the author of The Frugalista Files: How One Woman Came Out of Debt Without Giving Up the Fabulous Life

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