Managing your child’s acting earnings wisely can make a big difference in their financial future. At The Playground Acting Conservatory in Los Angeles, we guide parents on how to handle their child’s income responsibly. Here are some simple tips to help you manage your young actor’s finances effectively.
1. Set Up a Coogan Account
The first step in managing your child’s earnings is setting up a Coogan Account. In California, this is a legal requirement for child actors. A Coogan Account is a special trust account where a portion of your child’s earnings, usually 15%, is set aside until they turn 18. This protects their money and ensures they have savings for the future.
2. Create a Budget
Creating a budget helps track where the money goes. List all expenses related to your child’s acting career, like classes, headshots, and travel. Deduct these from their earnings to see how much is left. Make sure to save some of the remaining income for future needs or unexpected expenses.
3. Save for Taxes
Child actors, like all earners, need to pay taxes. Set aside a portion of their earnings for taxes so you’re not caught off guard. Consulting with a tax professional who understands the entertainment industry can be helpful. They can guide you on how much to save and what deductions you might be eligible for.
4. Invest Wisely
Consider investing some of your child’s earnings in low-risk options like savings accounts or bonds. This helps their money grow over time. Teaching your child about saving and investing can also be a valuable lesson in financial responsibility.
5. Plan for the Future
Think about your child’s long-term goals. Save for college, future training, or other big expenses. Setting clear goals helps keep the focus on building a secure financial future for your child.
6. Keep Accurate Records
Always keep detailed records of your child’s earnings, expenses, and savings. This helps you stay organized and provides a clear picture of their financial status. It’s also useful for tax reporting and financial planning.
At The Playground Acting Conservatory, we believe in preparing our students and their families for success on and off the screen. Managing your child’s acting earnings responsibly is an important part of their career. By following these simple steps, you can help ensure your young actor’s financial well-being and future security. Contact us.
