Friday, August 20, 2010

How Much Does a Writer Make?

I have read through several years of your back posts and I have a quick question for you as an assistant agent with inside knowledge and also for you as a published author in your own right.

You mentioned in a couple of your posts that it is common to see advances for new authors in the 5000-7000 range but I can't find any information about royalties. You do mention in an almost off handed way that each time you sell a book you receive about $1.12. What sort of annual income is typical for a author that publishes one book every other year. I think I could write a book a year if not more but I know the editing and everything else can drag out the process. I have no idea what typical sales for a book are. I understand that it is completely dependent on how well the book is received, I'm just looking for averages here.

Making money is complicated. Let me explain as best I can.

(1) Advance. This is an advance on future royalties. It is usually lower than it should be. It used to be new authors would make at least $5000-$7000, now it could be lower than that. Publishers don't like to spend. Repeat authors in the same company will make more and more on each advance. Ten years ago, if you were an established fiction author, you would be making around 30K a book in advances, so if you produced a book a year, you were doing well. These numbers are generally not maintained for mid-list or anyone below mid-list.

Non-fiction is an entirely different story. There is a huge range in advances. Most I've seen are above $20K.

(2) Royalties. The royalty rate for fiction is, at bottom level, 7.5% off LIST price, meaning the price they print on the back of the book, regardless of what the store sells it for. 7.5% is considered the bottom; more reputable places will give 8 or 10%. Then there's something called "escalation" where if your book has sold a certain number of copies (say, 20,000) the royalty rate will rise because at that point the publishers have earned back all the money they spent on producing the book and are willing to give you a little more. A nice escalation is to 20%, or in the case of a ton of books, 30%. Escalation rates vary hugely from company to company and also based on expectations of how much the book will sell.

From what I've seen, e-book sales have their own rate (which should be higher, like 20%, but publishers are working to keep that down), or they're a higher rate off NET prices, which is a percentage of what the book is actually sold for and what the publisher gets back from the bookstore. Net royalties are usually in the 20-30% range, but I've seen them higher. We expect e-Books to move up and down in terms of royalties as publishers and e-Book sellers figure out what the hell is going on.

(3) Payment of advance. Payment of advance occurs before the book sells any copies, though sometimes it's split up so the publisher can hold on to their money longer (publishers have a lot of tricks to do this). For a smaller press with a small advance, full payment can be upon signing, meaning a month after you sign the contract and it goes back to the publisher and it goes through accounting, then to your agent, then gets back to you. Some publishers split it to two dates: (1) Signing of the contract and (2) delivery of the completed manuscript to the publisher. Additionally, it can be split up as (1) signing, (2) delivery, and (3) publishing date. If you get a $500,000 advance, your publisher is going to pretty eager to split up payments, because it could be a year to a year and a half between signing the contract and publishing the book.

(4) Payment of royalties. After you earn out your advance, you will see royalties based on how well your book is doing. If the advance is high, you may not see royalties for years and years and years or never see them at all. The publisher is still required to tell you what you've been selling (a royalty statement) during one of its pay periods. It used to be quarterly, but now some publishers have moved to fall and spring, meaning I'm paid my royalties in November and April. If the number is below a certain amount (say, $50), the publisher may hold onto it until it earns that amount. Publishers don't like writing $4.00 checks. If it's within the first 6 months of publication, the publisher may stipulate that they can hold back 50% of your earnings against returns of the books by stores, which will then subtract from your future earnings, and if there are no returns, they will release your earnings the following year. The following year, they can then take the amount they owed you the previous year that they held against returns and split THAT in half, and hold that half against more returns. In other words, if your book does well, publishers will perpetually owe you money because they will find ways not to pay you.

The only advice I can say when planning a writing career is: don't. I make most of my money from books, but I'm never sure when the next book will sell, the next contract will be signed, and for how much. I don't know my royalty earnings until I earn them. It's like having a job where sometimes you earn lots of money and sometimes you earn none, but most of the time you're lucky to earn just enough to say, "There's no reason to get a real job. I'm building my career." Or that's what I tell my parents.

44 comments:

Brad Jaeger said...

Thanks for the information!

Anonymous said...

I publish a book every other year, and I make about $3000 a year. This can be interrupted by publishing dates being changed without notice, or by editors not getting back to me about changes for months and months so that my next check isn't released on schedule.

Most books do not earn out, meaning you get no royalties beyond your advance.

wordsareforwriting said...

Thanks for the reality check.

It's a little sad to think that after months of slogging away at a book, the financial returns can be so slow. :(

CPatLarge said...

This was tremendously informative. It's like pulling teeth to get most writers/agents/publishers to talk about real numbers and contract rates. Thank you so much!

tim said...

This is good to know, although my (admittedly limited) experience with nonfiction has revealed much less earning potential, especially working with a small press. At first, I was shocked and then I felt dismayed, but then I thought: why quibble with them over such small amounts. Am I in it for the money? I suppose I have to eat, but it seems hard to imagine my creative writing ever rising above the earning potential of my corporate day job. Now I must finish the manuscript!

Good site, by the way. I've been following for a few months now and appreciate all your hard work.

Kate said...

Thanks for this!

middle grade ninja said...

Great post! Thanks for sharing.

The Rejecter said...

All of my books have earned out, but I had really, really low advances in each case.

CFD Trade said...

Do agents still get commission with the royalties or do they only get commission with the advance?

The Rejecter said...

They get a commission on everything you make that they handle.

Voirey Linger said...

Figuring out the money side of the business can be very confusing. Thanks for the information.

One note on e-publishing. I'm not sure what houses were researched to get the 20% to 30% rates, but the houses I've investigated, which are romance e-publishers with limited print titles, average 35% through 40% of the cover price. With the e-book business modle there are no advances. This may be genre specific. I can say my own royaly rate is over the 30% top end quoted in the article.

Jessie Mac said...

Thanks for the post. It's good to know.

So to really make a living, you've got to write a book that sells or write 4 books a year - if you're earning what anonymous earns per book - just to get the annual income to survive.

I feel a bit like a madman banging his head against the wall of an empty room in an asylum. Yet the door is wide open for me to walk.

The good news is I'm not alone.

Are things better now than they were or getting worse for writers?

Iyan said...

I am a bookworm, not a writer. After reading your post, I appreciate writers even more: they write primarily to say something, not for money alone.

Nobu said...

http://www.deanwesleysmith.com/?p=607

Here's a different perspective and explanation, if anyone cares :)

You can, in fact, make a good living writing fiction. But maybe not writing a book every other year...

Anonymous said...

There's actually not a big difference between the data that The Rejecter provides and what Dean is saying.
There are other sales, but not all authors will be able to sell audio rights/movie options/translation rights...
There's also this bit, in one of his comments:
"If you write two short stories per year and one novel per year, you will never get there, at least not in a generation or two. But if you write three novels per year and a dozen short stories per year, it won’t take you long at all to pick up real speed and practice enough to learn your craft."

Sean said...

It's impossible to make a living publishing books. Yes there are a handful of people who do, like Stephen King and J.K. Rowling. None of us are them.

The only way to make a living as an author is to have another job, preferably one that helps you promote the book. Radio show hosts, newspaper columnists, and hardcore bloggers not only have the income those gigs offer, they have an attentive audience already in place.

I've written four books and co-authored/edited a dozen more. Trust me folks, there's no money to be made writing books.

Ioana Savin said...

A real writer doesn't write for money. We write because we want the characters we dream about let us sleep at night. We could had a better job, better paid, but we prefer writing for the up coming generations. Someone must write for them too. Probably our names will remain in history like Homer's, or probably not. No one paid Homer for his masterpieces. The thing is we don't do that for money. 3000 a year is too little for the effort we make writing the novels. A writer is a God in his book. We create everything, the people, the landscapes, the colors, the action. No one pays God, why should they pay us? And look, they do.

Melinda Szymanik said...

the advances are significantly lower where I live - we have a very small population and getting our books picked up overseas seldom happens. I earn more money talking about writing (author talks and workshops) then I do from my books but this eats into my writing time.

Best to think of earning potential as a pyramid with most writers getting very little, on or near the bottom level

Alice Gabathuler said...

I don't earn enough from book sales - but I do a lot of readings; they are my main income.

Julia B said...

This may sound like a stupid question, but do you need to pay back any of the advance that's not earned out in royalties?

Enquiring minds want to know :-)

The Rejecter said...

No, you do not. The advance is made in good faith.

error7zero said...

Very informative. So if I want to get a higher advance for my angst ridden, teenage vampire saga, I ought to describe it as a non fiction personal memoir?

Rane Anderson said...

Good information, thanks.

Anonymous said...

I'm late to this, but that is an amazingly comprehensive answer. Congratulations.

Mel said...

Interesting article. There are ways to make money as a writer. I haven't even published a real book yet, and I am making a decent living off of freelancing and an ebook I just published last week. It can be done but it takes persistence and drive.

Blessings,
Mel
Please feel free to stop by: Trailing After God

chase said...

i just sent in a fiction book, which was my first of course but i have always been a good reader in fact when i was in third grade i read at an adult level... so if my writing is good then maybe i can make some money that my mom wont steal... am i the only fourteen year old author here!!?? x. x but what if i dont have a bank account? i have a savings though would it go into that? or would it go into my moms?

Anonymous said...

More reason to not waste a second writing something you don't enjoy.

Joe Renzo said...

I posted on my blog recently the actual figures from a book that debuted on the NY Times Bestseller List a #19. You can see the figures from the first statement, and then from the second. The second statement will show you what he made after 11 months since the books release date. Your info is great and I feel my post could also shed some light on the situation. Check it out.

How Much Does An Author Really Make

Joe Renzo
Joerenzo.com
@byjoerenzo

Joe Renzo said...

Just to let everyone know My blog got completely erased so this post is no longer on there. I don't want people to think I'm trying to trick people to go to my site. I can promise that I will try to rewrite the old post and put it up again. I will post here when I do it to let everyone know that it is back up. Thanks again and I'm sorry for the inconvenience.

Anonymous said...

I doing this project i wanted to know how much a writer makes but it doesn't really make sense to me.... so how much do they really make

Chris W said...

This whole thing is of course based on the current publishing model, which I can't imagine being sustainable.

I understand the publisher's point of view about promoting, printing, and logistics of book distribution. But now publishers are making pure profit from e-books. There is NO reason that contracts couldn't be written where the author gets 70% (yes, that's 70%) each time an e-book is sold.

Google just launched Google Music where the musicians get 70% of each sale. I can see this as the model of the future. Imagine a Google Books (different from the current iteration) that directly shares with writers and share the revenue similarly. Doing the math, a person selling just 25,000 books for $4 would make $70,000.

True that there are e-publishing outlets where writers can go (like pubit.com) but it's certainly not main stream yet. I look forward to the day where writers get what they are worth, and readers get e-books for a relative bargain.

Anonymous said...

http://www.deanwesleysmith.com/?p=607

This cannot be ignored. If you have a good product and know how to play the game there is obviously money to be made.

People here seem to like the idea of the poor struggling writer. How about opening your mind.

My writing has made me enough not to work in any other job. I write novels about topics I love. The money comes in from some many places!

Anonymous said...

I write erotica and self publish on amazon an smashwords. In 2010 I made about $23,000. In 20111 I made $49,000!! But now in 2012 my sales are looking like they're returning to the $20K - $30K/yr range. They are vampire erotica. I rode the vampire wave and it paid out. I don't have any secrets to success. I just wrote and published. I think people should know that it's possible to make money by self publishing. Good luck!

Anonymous said...

truly, there are books where the author should pay you to read them , nothing but crap and a waste of time including many at college level. dull, pointless. if you really have a mind like a founding father and you can write a book that can challenge the most rational people ever existed. i bet you can make millions and this book will be translated to many languages . watch out will be coming soon. who wants to read crap , erotica vampire etc

Anonymous said...

"The only advice I can say when planning a writing career is: don't."

What a jerk. Perhaps if he wrote better he could.

Tyne Swedish said...

This was very helpful. Thank you.

Anonymous said...

Great Post! Very informative. I will be on the NY Best Seller's list very soon. Speak it and believe.

Anonymous said...

Thanks, helpful post.

Anonymous said...

@anonymous who called the writer of this post a "jerk": This is why people like Amanda Hocking and other successes don't waste their time offering "failing writers" advice, because they don't know how to LISTEN. They name-call if someone doesn't tell them they'll be the next JK Rowlings. Learn how to listen. Also, this is this blogger's post. They can post what they want, right? If you disagree, no need to name-call, IMO.

Anonymous said...

@chris w- how do you verify that pubit.com is a valid site? They ask for every bit of your personal information (i.e.; banking info, social security and tax info, credit card info...) without having verifying marks on their site that state they wont still your personal identity. I have to admit, I dont feel very comfortable giving out that info freely over the internet.

The Rejecter said...

Pubit is legitimate. It's like the KDP of Barnes and Noble. It needs your bank info so it can pay you.

Anonymous said...

Thanks for the info! Is there a how-to book you view as a "must read" for aspiring fiction writers? My husband's theory is that if my book gets published, I will only make $200. Normally he's supportive, but money is tight so he's leery of me spending money taking writing classes.

Anonymous said...

Like any other career or vocation in society, fame and fortune is elusive. Any career, and I mean any, has its own dreamers. That's not bad. And in any career, by a stroke of circumstances, luck, and whatever you call it, there will be the few who get's fame, fortune, or both. Medical practitioners, lawyers, businessmen, programmers, name it, are not different animals. Imagine, thousands of them get into school to achieve their dreams. So few made it. There are thousands of programmers but only a few - bill gates, mark zuckerberg, larry page/sergey brin, et. al.,- made it real big.

If you want to write for money, that's great. And for the sake of writing, that's great too.

You can try and if you love what you do and happy about the writing process itself, do it even if you won't earn much. If you earn so much, that's not bad.

You can try. If you won't make money, then it was never meant to be.

Anonymous said...

The publishing industry is in the dumps. I work for a publisher. I'll be lucky if I still have a job in a month. The authors are making pennies these days compared to what they were getting two years ago. It's dismal. But hey, if you're okay making nothing for months of hard work, go for it. I'm not telling you not to, just telling you what the reality is right now thanks to all the self publishing going on.