I ran across an article about an artist who painted the cover of Jethro Tull‘s Aqualung. He was paid a fixed fee, $1500, for three pieces of art in 1971.
It’s a little bit sad that this fellow did not make more money off the job. That $1500 is only worth about $9000 in today’s dollars, according to this Bureau of Labor Statistics’ CPI Inflation Calculator. I suspect that many artists would be thrilled to make $9K off a few paintings, these days. However, I can imagine that it’s still a bummer when your artwork is generating millions for the people who bought it, and you don’t get any royalties from that.
This artist doesn’t get a do-over. However, we can learn from this lesson! Nowadays, it is extremely easy to invest in index funds online. Even just $1000 invested in the S&P 500 in January of 1972 would be worth approximately $100K today. If you are an artist, and you do not have the power to negotiate a royalty agreement, you can still take your payment and invest it in a low-fee index fund like Vanguard’s VFINX. Depending on your tax situation, you might also want to put it into a retirement vehicle such as an IRA or 401K, which offers tax protection. There’s always risk involved in investing, but there’s a lot of risk involved in sticking your money in a saving account, too. Inflation will eat away that money in no time.