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Money Post, Year 2

Last year, several folks wrote about how much they made as a working writer. I joined that conversation, mostly because I felt it was an important reality check. At the time I fully intended to continue doing so in 2009 and beyond, because I think the more information we share as writers, the better prepared we are for this crazy career.

Then 2008 turned out to be a much better year, and I hesitated. Suddenly posting the writing income feels more like gloating. But I decided to go ahead, because this too is part of the reality check. There are good years as well as bad, and the variation from one year to the next can be both dramatic and unpredictable, at least for where I'm at. (Full time freelancers probably have a better handle on what to expect from year to year.)

As of 2008, I had been writing for 14 years, and I had three books in print with a major publisher. The year before, I made just under $16,000 from my writing. In 2008, I made $54,000.

To my shock, I actually made more from writing fantasy than I did from my day job. But I'm still a long way from being able to quit the day job. For one thing, the writing income doesn't include benefits. For another, the writing income is not at all stable, and there's a very good chance 2009 will look more like 2007 than 2008. For those two reasons, I expect to keep punching a time clock for the foreseeable future.

The breakdown for that money looks like so:

Novels (U.S. Sales): $8000
Novels (Foreign Sales): $44,000
Short Fiction Sales: $2150

This seems like a good time to say how much I appreciate my agent. He kicks ass, and is directly responsible for those foreign sales that covered my wife's tuition and some much-needed house repairs last year. Thank you!

I write a book a year. Looking at this, it's pretty clear that -- in theory -- you can make a liveable income on a book a year as a low-to-midlist writer, but only with those foreign sales to supplement your income.

Of the foreign income, I'd say over half comes from Germany, where the goblin books really took off. That's not something I had any control over, and I can't guess whether the same thing will happen with Stepsister. It's much more common for a foreign deal to earn $1000 than $10,000, at least for where I'm at in my career.

I was most surprised at the short fiction total, actually. I haven't written that many short stories this year, but they've been going mostly to professional and pro-paying markets. That adds up.

I don't expect 2009 to pay as well. (Though I'll be happy to be proven wrong!) Nor am I looking forward to doing my taxes this year. That's another fun thing about freelancing -- taxes aren't deducted from that money, so I'll be writing a nice big check to the government just as soon as I get my paperwork from the day job. This is the first year I'll have a tax debt, so not only do I pay for 2008, I also have to pay estimated taxes for 2009. Ouch.

So, any questions about the financial side of the business? Is this helpful, or has it moved into the realm of pure ego-stroking?

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( 112 comments — Leave a comment )
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ex_paulskem
Jan. 20th, 2009 02:59 pm (UTC)
Good information, not ego-stroking.

Those foreign sales sure were a little sumptin'sumptin'. :-)
jimhines
Jan. 20th, 2009 03:03 pm (UTC)
Heck yeah. JABberwocky is probably one of the best in the business for foreign sales. I feel incredibly lucky to have ended up with them.
margaret_y
Jan. 20th, 2009 03:07 pm (UTC)
Jim, I believe I said this last year, and I'll say it again. You are my hero. This kind of post is extremely brave. In our culture, we are so weird talking about money. Thank you for this.
jimhines
Jan. 20th, 2009 03:14 pm (UTC)
Thanks. I'm glad it's helpful!
mmuenzler
Jan. 20th, 2009 03:08 pm (UTC)
Oh man, that is gonna be a huge check to the government. But live up the coolness of breaking your day job income--that is a super awesome accomplishment!

I think it is wise of you to stick with the day job until you have a way to cover the lost benefits (especially as health care costs continue to rocket), though it is also more difficult as everything bleeds for more time. It seems a difficult choice to make, when to switch to full-time writer, considering the inherent instability of it as a career. Especially as you have family to take care of also. I hope you are able to reach the point very soon where you can safely do so, though (possibly because my husband is quickly devouring your Goblin books and I am going to be hard-pressed to find more books for him to eat).

:)
jimhines
Jan. 20th, 2009 03:16 pm (UTC)
I have a high deduction at work, which should help. And my wife going back to school should give us some deductions for tuition. But yeah, it's still gonna sting.

I'm waiting to see what happens when my wife finishes grad school. If she's able to find a job that's stable and pays well enough, I'll be ditching the cubicle so fast my shadow will be running to catch up :-)
(no subject) - mmuenzler - Jan. 20th, 2009 03:20 pm (UTC) - Expand
cedunkley
Jan. 20th, 2009 03:08 pm (UTC)
Thanks for sharing this. As an aspiring writer this is one of those areas where there really isn't a lot of information available beyond theory. And since it isn't polite to ask someone what they made having authors step up and share like this is quite helpful.

jimhines
Jan. 20th, 2009 03:17 pm (UTC)
You're welcome! It actually amuses me sometimes. When I talk to most writing groups, it's the one thing that never comes up. But if I go and talk to a group of kids?

"Hey, does this mean you're rich?"
"How much do you get paid for that book?"

And so on :-)
bondo_ba
Jan. 20th, 2009 03:09 pm (UTC)
My vote is that it's extremely helpful. I think it's great that some writers are as open aboout the financial side as they are about the creative side.

Hope you make even more money this coming year.
jimhines
Jan. 20th, 2009 03:20 pm (UTC)
I know it helped me a lot to hear about the business side of things. Tobias Buckell's first novel advance survey was probably the first resource I ever saw along those lines. (It's at his web site if you haven't seen it.)
(Deleted comment)
jimhines
Jan. 20th, 2009 03:21 pm (UTC)
You're very welcome!

You might also check out Tobias Buckell's first novel survey at http://www.tobiasbuckell.com/2005/10/05/author-advance-survey-version-20/
naturalfractual
Jan. 20th, 2009 03:13 pm (UTC)
Tax Break
Something I have done when I owed good old Uncle Sam - make a sizeable contribution into an IRA - if you have a good accountant you can get good advice - or talk to a Credit Union.

I hope you write lots more books and make lots more money!
zen_kitty
Jan. 20th, 2009 05:09 pm (UTC)
Re: Tax Break
There's also something called a Solo 401K, which can more than double the amount you can sock away tax free. http://www.mymoneyblog.com/archives/2006/08/self-employed-solo-401k-vs-sep-ira-basics.html
Re: Tax Break - cathshaffer - Jan. 20th, 2009 07:46 pm (UTC) - Expand
Re: Tax Break - irysangel - Jan. 21st, 2009 02:23 am (UTC) - Expand
wishwords
Jan. 20th, 2009 03:17 pm (UTC)
That's great! It's actually encouraging.
will_couvillier
Jan. 20th, 2009 03:21 pm (UTC)
I toss in a helpful. It also reminds me of Isaac Asimov's autobiography volumes. He posted his yearly earnings from his writing covering decades - until his pay reached a demonstratively regular, moderately growing level. I found it interesting then, and still do now.
jimhines
Jan. 20th, 2009 03:38 pm (UTC)
I'm really hoping it will all stabilize eventually. It makes sense that things are pretty wild in the beginning, and in a lot of ways I'm still new at this.

And now I want to read Asimov's autobiography, because I like his writing style, and I expect they'd be both interesting and easy to read.
(no subject) - will_couvillier - Jan. 20th, 2009 03:45 pm (UTC) - Expand
dqg_neal
Jan. 20th, 2009 03:22 pm (UTC)
Nah, not ego-stroking.
I'm actually quite surprised by all the foreign sales. I always assumed most of the income would come from here.. And that foreign sales would just help pay for bookmarks and other promotional things.

jimhines
Jan. 20th, 2009 03:36 pm (UTC)
Any individual foreign sale is usually a lot smaller than what you'll get in the U.S., but they add up, especially when your agent is a foreign-sales bad-ass :-)
(no subject) - beth_bernobich - Jan. 20th, 2009 06:09 pm (UTC) - Expand
(no subject) - jimhines - Jan. 20th, 2009 06:25 pm (UTC) - Expand
ziactrice
Jan. 20th, 2009 03:26 pm (UTC)
Very neat; will you have to make estimated quarterly payments in 2009? And if you do have to do so, I hope it is based on last-five-years-running-average, not just the previous year. It has been so many years since I was working as a draftsperson on the side I cannot recall how I did it - but it was STEEP, because I had to pay both halves of the Social Security AND the tax to ol' Uncle Sam. Ouch.
jimhines
Jan. 20th, 2009 03:45 pm (UTC)
I'll have to pay 2009 taxes this year, but I still need to figure out what the 2008 debt is (waiting on W2s from work) before I can calculate the estimated 2009 taxes.

I suspect there will be much time spent on the IRS web site, and possibly some accountant consulting at that point...
kara_gnome
Jan. 20th, 2009 03:26 pm (UTC)
No, I thought this was great! It's just, I don't know, part of it all and keeping it real :)
ex_kaz_maho
Jan. 20th, 2009 03:28 pm (UTC)
I love these posts, Jim. Thank you! Makes me realise how far I have to go... But that's not a bad thing. :)
jimhines
Jan. 20th, 2009 03:55 pm (UTC)
I had that same realization when I read another author posting about what she hoped to hit with her first week's sales in order to satisfy her publisher.

Her one-week goal was about what I sold in my first three months...
(no subject) - brainstormfront - Jan. 20th, 2009 04:39 pm (UTC) - Expand
cathschaffstump
Jan. 20th, 2009 03:29 pm (UTC)
First of all, congratulations of a sort. That's a very good income for a writer.

Secondly, I thought this was very helpful. I didn't know that you had to pay estimated taxes for the following year. Bugger.

Do you have someone help you with your taxes, or do you tackle them on your own?

Catherine

jimhines
Jan. 20th, 2009 03:34 pm (UTC)
I'm doing them on my own, so far. (I've picked a few writer brains for advice in the past.)

Usually you pay estimated taxes for the next year, and that way you're constantly paying one year ahead. For example, in 2010, I'll have already paid my estimated taxes for 2009, so I only have to worry about paying ahead to the 2010 taxes.

But the first year gets you twice. I need to pay what I owe for 2008, and the government expects my income to be the same, so they want me to pay that for 2009 as well. Whee...
(no subject) - cathschaffstump - Jan. 20th, 2009 03:49 pm (UTC) - Expand
(no subject) - sylvia_rachel - Jan. 20th, 2009 07:14 pm (UTC) - Expand
(no subject) - cathshaffer - Jan. 20th, 2009 07:50 pm (UTC) - Expand
(no subject) - mroctober - Jan. 20th, 2009 03:34 pm (UTC) - Expand
(no subject) - jimhines - Jan. 20th, 2009 03:37 pm (UTC) - Expand
comrade_cat
Jan. 20th, 2009 03:32 pm (UTC)
I vote helpful. It's interesting. Good luck on those foreign sales!
autopope
Jan. 20th, 2009 03:37 pm (UTC)
Writing is like that. Drip, drip, drip of tiny cheques for years on end, then a couple of years after the first novel, WHOOSH!

I turned that corner in 2006 and I am still rubbing my eyes. (That was the year my writing income literally doubled overnight.)
jimhines
Jan. 20th, 2009 03:44 pm (UTC)
Exactly! It was probably around halfway through last year when I got a check from Germany that was more than my entire 2007 writing income. Blew me away!
secritcrush
Jan. 20th, 2009 03:38 pm (UTC)
This is really helpful - especially knowing what's possible in foreign sales.
jimhines
Jan. 20th, 2009 04:15 pm (UTC)
That's been an eye-opener for me as well.
ogre_san
Jan. 20th, 2009 03:43 pm (UTC)
It does confirm something Mike Resnick said about the business, in that a novelist should be making at least as much from foreign sales as they did domestically. Looks like you've done even better!
jimhines
Jan. 20th, 2009 04:00 pm (UTC)
That makes sense. It's a much more important income source than I ever realized.
ckastens
Jan. 20th, 2009 03:49 pm (UTC)
Thanks, Jim! As always, great information.

The foreign sales are a mystery. When Deer Hunter was launched in Germany a few years back it ended up with around 30% of its worldwide sales there, completely unexpected.

And congrats on the big increase! (a completely non-ego-stroking congratulations, of course :)
jimhines
Jan. 21st, 2009 01:59 am (UTC)
In a lot of ways, foreign sales feel like found money. Hard to predict, but very nice when they show up :-)
(Deleted comment)
jimhines
Jan. 20th, 2009 03:58 pm (UTC)
It was perfect timing, really. German check arrives; wife starts grad school. Another check shows up; kitchen counter starts rotting away from water damage. All in all, 2008 worked out pretty darn well :-)
zen_kitty
Jan. 20th, 2009 04:01 pm (UTC)
Let me add to the "Thank you for sharing this" sentiments.

This is really helpful information. Plus I am truly thrilled for you!

I agree with cathstaffstump. If you don't have an accountant, get one. It will help you immensely with figuring out all of the tax deductions for your schedule C. You'd be amazed at how many there are. For example - everything next weekend will be tax deductible including your mileage. *grins*
jimhines
Jan. 20th, 2009 04:12 pm (UTC)
You're very welcome!

And yep, I've been tracking mileage for years. Not to mention figuring out the standard meal deduction vs. the actual receipts for the weekend. (I eat cheap, so standard deduction comes out much nicer :-)
arielstarshadow
Jan. 20th, 2009 04:04 pm (UTC)
A further question:

Once you deal with the taxes and calculating your expenses - what does that $54,000 turn into in terms of net income?
jimhines
Jan. 20th, 2009 04:11 pm (UTC)
I'm not sure yet. I know there's at least $3000 worth of expenses -- conventions, promotion, and a laptop. I suspect that will be a bit higher by the time I finish going through all of the writing-related deductions.
(no subject) - cedunkley - Jan. 20th, 2009 07:04 pm (UTC) - Expand
(no subject) - jimhines - Jan. 20th, 2009 07:19 pm (UTC) - Expand
(no subject) - cathshaffer - Jan. 20th, 2009 07:52 pm (UTC) - Expand
(no subject) - cathshaffer - Jan. 20th, 2009 07:54 pm (UTC) - Expand
jtglover
Jan. 20th, 2009 04:13 pm (UTC)
Thanks for posting this, Jim. It's good information for we wee folk, and an encouraging antidote to Doom and Gloom, both general and publishing-specific. Oh, and if you are gloating, it's not coming through. :)
jimhines
Jan. 21st, 2009 01:58 am (UTC)
You're very welcome. I think the anti D&G is another nice piece of the foreign sales. Even when things in the U.S. are slumping, publishers in other countries might not be suffering as badly.

And part of the reason the check from Germany was so nice is that I was paid in Euros, and at that point the dollar was so weak the exchange rate worked out very much in my favor.
raisinfish
Jan. 20th, 2009 04:16 pm (UTC)
I think it's helpful. Thanks.
(Deleted comment)
coppervale
Jan. 20th, 2009 04:43 pm (UTC)
Just my two cents (so to speak): I DID sell S&S world rights, with the intention that they'd be handling the foreign sales. Because they have their own UK and Canadian setups, it was seen as beneficial to them, but it was also incentive for them to push the global sales (which they've certainly done).

One thing to remember, is that until the deal is signed, it's all negotiable. So my very smart attorney made the change that we would sell them foreign rights, but instead of the fifty/fifty split (of monies) they asked for, I'd get 75%.

So far, so good. And I have someone there whose full time job is selling foreign rights - meaning my management team and I only have to deal with my publisher here.
(Deleted comment)
(no subject) - coppervale - Jan. 20th, 2009 05:21 pm (UTC) - Expand
(no subject) - jimhines - Jan. 20th, 2009 06:05 pm (UTC) - Expand
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