Thanks to a newsletter from NYFA I became aware of an innovative pension plan for artists.
The Artist Pension Trust provides pension services to artists “a group whose career trajectories and employment patterns make existing pension programs inaccessible.”
They do this by essentially having artists invest their talent instead of money. Each artist makes annual contributions of work over the course of 20 years. The pension funds come from the sale of the art work. The proceeds of the sales are distributed as follows:
“40% is directed to the pool and distributed pro rata among all the artists…and 40% is directed to the account of the artist whose work was sold. Each artist receives an equal share of the pooled funds generated by the sale of the works held in the Artist Pension Trust, thereby benefiting from the collective success of all of the artists in his/her Trust. Each artist is additionally rewarded according to his/her own individual market success, since 40% of the proceeds of the sale of his/her work can be invested in the artist’s individual account.”
The thing I like about this arrangement is that not only is each individual rewarded for his/her own success, but it also encourages all the contributing artists to promote their fellows. Instead of viewing each other entirely as competitors for art buyers’ money, there is a benefit to openly advocating another’s work.
The remaining 20% of the proceeds will go to the pension fund administration fees. This may seem like an excessive amount until note that the fund has to store the pieces and promises museum quality care and presentation.