In this episode, we discuss strategies for making money as a writer.

Many authors are frustrated because they’re not earning enough to make writing a full-time career. They dream of quitting their day jobs, but to do that, you need to sell books. While we often focus on increasing book sales, there’s another side to making money as an author. This topic was inspired by a listener question from Ben Kreis, author of Backpack Time Machine.

Ben asks, “I’m not a hobbyist. I want to make a career out of writing. Do I have to write novels, or are there other forms of writing I can use to earn money?”

Jim: When we say this episode is about making money, we mean making money through your writing.

Thomas: To become a career author, you must think like a business. By adopting a business mindset, you may be able to quit your day job sooner than you expect.

Jim: Many novelists wish they could earn 100% of their income from writing novels, but that’s not realistic. Historically, from 100 years ago to today, only about 2% of novelists make a living solely from their novels. Even bestselling authors often have other income streams. Even William Faulkner wasn’t a full-time novelist.

It’s okay to earn some money from novels and supplement it with other writing-related activities.

Thomas: If you think of yourself as an artist, you risk starving like one. Many authors say, “I’m an artist; it’s about the art!” But that’s amateur thinking.

Professionals treat writing like a job. They write consistently, whether they feel inspired or not, and they handle the business side or hire others to do so.

You might dream of mailing a manuscript to a publisher, receiving a big check, and writing your next book in the Bahamas. That’s a fantasy. We’re here to share the real world. The good news? If you embrace reality, there are plenty of ways to make money.

Jim: Would you rather earn a living writing or make a little from novels and the rest working at Starbucks? The good news is you can use your writing skills to generate income.

Tip #1 Think Like a Business

Thomas: You are a business. Try this exercise: say your name followed by “Incorporated.”

Jim: James L. Rubart… Incorporated.

Thomas: There you go! You are a business, and your book is just one of your products. Once you see yourself as a business selling products, a world of opportunities opens up. The principles in the marketing books now apply directly to you as a businessperson selling a product.

Jim: I was recently working with an author who was excited about a website for their new book. I stopped them and said, “No, your website isn’t just about one book. It’s about you.” Your brand is the umbrella, and books are just one product. There are many ancillary products and courses you can develop. You are the brand; you are the business.

Thomas: This is especially crucial now because of the indie publishing revolution, which has reduced earnings from individual books. At the same time, there are many other ways to make money. Jim, as a traditionally published author, have you experienced this?

Jim: Yes. For example, I earn money writing back cover copy for other authors, speaking at writing conferences about writing and branding, and developing ancillary products. I know two New York Times bestselling authors who are creating e-courses on writing. Everyone is diversifying.

Thomas: But you’re a bestselling author. Aren’t bestselling authors supposed to be rich?

Jim: I’m earning about 90 cents per book.

Tip # 2: Delegate

Thomas: A key to running a business is hiring people and delegating tasks. My dad, a successful businessman, always said, “Only do what only you can do. Delegate the rest.” Imagine you have a side job editing books for $30 an hour. Someone at your church is unemployed and offers to clean your house for $20 an hour. Should you hire them? An artist might say, “No, I’ll save $20 by cleaning myself.” A businessperson says, “Yes, I’ll hire them. If I edit for an hour, I earn $30, pay $20 for cleaning, and still have $10 left, plus a clean house.” More importantly, you’ve created a job for someone who can’t do what only you can do. You’re benefiting yourself, the other person, and the economy.

Jim: Another benefit is that the more you focus on your craft, the better you become. As you gain expertise, you can charge more for your services.

Thomas: Exactly. Editing sharpens your writing skills. A great resource for learning to delegate is The 4-Hour Workweek. It details how the author reduced his work from 80 hours a week to 20, then to just 4, through radical delegation. I don’t endorse everything in the book, but it’s a solid guide for delegation strategies.

What can you delegate?

Thomas: If you’re starting out, you may not be able to afford to delegate, so you might barter or enlist your spouse. But when you can, your dream team includes a writing assistant, editor, literary manager, webmaster, investors, agent, and CPA.

Writing Assistant

Jim: A writing assistant handles small, time-consuming tasks that aren’t the best use of your time. Many ask, “How do I pay for one?” Bartering is an option. Some people want to learn writing and would trade services for one-on-one mentorship.

Thomas: Your stage in the writing journey matters. Early on, you might assist another author, becoming an apprentice to learn the craft. There are benefits to that, and you could barter.

Find out how AI can function as a writing assistant for you.

Editor

Thomas: Bottom line? You need an editor. No exceptions.

Jim: Absolutely no exceptions. Even if there were, you’re not it.

Check out the following episodes to learn more about working with an editor:

Literary Manager

Thomas: A literary manager is for authors further along in their journey, typically with a dozen or more books in their backlist. They handle marketing your past books, coordinating speaking events and appearances, and managing logistics so you can focus on what only you can do: write. Think of your literary manager as a band manager for the author. In politics, a handler manages a politician’s schedule, protects their time, and keeps things running smoothly. For established authors, this support is invaluable.

Webmaster

Jim: You need someone to run and oversee your website, update plugins, and handle maintenance. Many authors say, “I’m good at coding; I can manage my own site.” But, if someone else can do this, you should let them. Thomas, you built your first website at 15, so you’re tech-savvy, yet you don’t manage your own site.

Thomas: Correct. I have a team of technical people who handle maintenance and website building because I don’t have time for it. They’re excellent at it, and that’s the point of delegation. Instead of being decent at many things, you excel at one thing—writing. Then, you can surround yourself with others who excel in their areas. This excellence drives success.

Investors

Thomas: Next, investors. The most traditional way to fund your book is through a traditional publisher. From a business perspective, publishers act as venture capitalists, providing capital, credibility, and connections. They typically invest $15,000 to $25,000 in your book, taking most of the profits in return, but you don’t pay out of pocket.

In the indie and internet age, crowdfunding platforms like Kickstarter or Indiegogo offer another option. Future readers can invest by pre-ordering copies. I’ve helped authors raise thousands this way. For my book, Courtship in Crisis, we raised $10,000 on Kickstarter, covering top-tier editors, copy editors, cover designers, and printing costs without out-of-pocket expenses.

Learn more about Kickstarter in the following episodes:

Agent

Jim: You also need to consider an agent. Indie authors might wonder why they need one, as agents traditionally focused on contracts for traditional publishing. However, the role of an agent is evolving alongside authors’ careers, which now blend hybrid, traditional, and indie publishing. Agents now assist with various aspects of an author’s career, whether you pay them a project fee, retainer, or another form of compensation. A good agent acts as a coach for your entire career, not just for traditional publishing.

Thomas: If you’re pursuing traditional publishing, an agent is non-negotiable. I’ve seen large publishers take advantage of unrepresented authors because there’s no pushback. An agent is like being part of a union, offering collective bargaining power. Some authors think, “Why pay an agent 15%? That’s money I could keep.” That’s artist thinking, not business thinking. An agent can negotiate a larger deal, ensuring 85% of a watermelon is far more than 100% of a grape. They prevent exploitation and pay for themselves. That’s why professional authors have agents.

CPA

Thomas: Finally, a CPA. We covered this when we interviewed a CPA (my father), who’s worked with celebrities and authors for over 35 years. There are significant tax advantages to being an author, even if you’re not yet profitable. We also have a course called The Tax and Business Guide for Authors.

Establishing Your Business

Thomas: We pulled a bit of a bait-and-switch earlier. When you said your name followed by “Incorporated,” you legally created a sole proprietorship in the eyes of the U.S. federal government. Congratulations! You were already a business the moment you started conducting business-like activities; no filing is required.

You don’t need to file anything to start a business in the U.S.; just conduct business. However, there comes a time when filing with the government is beneficial.

Step 1: Conduct Business-Like Activities

Thomas: The first step is conducting business-like activities, such as treating your book as research and development for your business.

Step 2: Open a Separate Bank Account

Thomas: Open a separate bank account immediately to track business expenses, like buying a computer, software, coaching, webinars, or conference travel. Fund this account with your own money as an investment in your business. These expenses may be tax-deductible, potentially offsetting income from your day job, which you hopefully haven’t quit. A separate account simplifies distinguishing business from personal expenses at year-end. Most accounts come with a debit card, so I use my business card for business purchases and my personal card for personal ones, keeping everything clean.

Jim: Psychologically, a separate account helps you take your business more seriously.

Step 3: Form a Business Entity

Thomas: As you earn income and hire team members, you’ll want to form a business entity, like an LLC. I own Castle Media Group LLC, which includes Author Media. LLCs are flexible, allowing taxation as a sole proprietorship, S corporation, C corporation, or partnership, and you can adjust this as needed. For an unpaid endorsement, I recommend LegalZoom.com to form an LLC. I’ve used both lawyers and LegalZoom, and I prefer LegalZoom’s contracts because they’re updated and cheaper. It costs about $99 plus your state’s filing fee.

Jim: I paid much more for my LLC through a lawyer.

To learn more about forming an LLC, check out The Author’s Guide to LLCs.

Creating a Budget

Thomas: Finally, create a budget. Decide how much to spend on developing your craft. If you’re just starting, invest in yourself, as your writing skill is your greatest asset. Buy books, coaching, and training. I’m shocked at how many authors hesitate to buy books on writing. If you expect others to buy your book, you should invest in others’ books that improve your craft. Books on writing, marketing, and platform are the best value for learning. I have no stake in this—I don’t sell writing books, though I have some eBooks on our site. Visit Barnes & Noble or Amazon, buy and read those books, and invest in yourself. Then, budget your spending and estimate your potential earnings to think and act like a business—the first step to becoming a career writer.

To learn more about how much you need to budget, listen to the following episodes:

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Links:

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1 Comment

Terri Picone on February 17, 2016 at 9:40 pm

Another great podcast by two very knowledgeable guys. Thank you, Thomas and James, for your willingness to teach fiction authors about marketing.

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075 – How To Become a Career Writer Part 1: Think Like a Business

Tip #1 Think Like a Business

Tip # 2: Delegate