Before You Quit Your Day Job

Things authors hear:

“I just bought a copy of your book, so you should be getting a little something extra in your paycheck this month!”
“I can’t wait for our library to get your book so I can read it.”
“Is writing books all you do?”
“I’ve got a great idea. You can write it and we can split the money.”
“People tell me all the time that I should write a book about my life.”

A poll recently showed that more than 80 percent of Americans believe their life story is worth a book and more than 60 percent believe they could write a book.
The most common question I get is, “How much money do you make?” Apparently, etiquette doesn’t apply when it comes to authors.

When I left my secure job as a reporter at The Washington Post in 1986, my mother was aghast. I was giving up a guaranteed weekly paycheck and lucrative pension. Even today, she sometimes asks me when I am going to get a real job. My father once asked why I didn’t just write books on the weekends so I could work during the week at something that paid regularly.
Both think I would make a terrific car salesman.
The reason why there aren’t many full-time authors (I’ve read there are only 1,200 who don’t augment their income by teaching or doing some other profession) is because it is a darn difficult way to earn a decent living. This is true regardless of whether you write fiction or nonfiction.
Some facts.
People buy fiction because of the author. If you enjoy reading books by Nelson DeMille, John Grisham or Sue Grafton, you will eagerly buy their next novel when it is released.
People buy nonfiction because of the subject matter. My first book was about a traitor who sold secrets to the Russians, the next was a true crime saga about a cult leader turned murderer, and the third was my account of a year that I spent as a reporter inside a maximum security prison. I know from tracking my web page that many of you who are reading this are fans of CRAZY: A Father’s Search Through America’s Mental Health Madness. You care about our broken mental health system. You might not care about life in prison.
Because readers are buying nonfiction based on the subject matter, it is difficult for most nonfiction authors to build a huge fan base, especially if you are constantly writing about different topics.
The good news about nonfiction is that a highly publicized subject, such as the Amanda Knox murder trial in Italy, will get you a hefty book contract. (She reportedly got a $4 million advance.) The bad news is that those big stories are difficult to snare. Nonfiction books also sell substantially fewer copies than fiction. Each year, Publishers Weekly, lists the number of best-selling nonfiction hard cover books that sold more than a 100,000 copies. There are generally fewer than a hundred on that list. The much longer fiction best-seller list starts with novels that sold a million or more copies.
Back to the money question. How does a book get sold to a publisher? When a nonfiction author comes up with a worthwhile subject, he/she writes a proposal that explains why the idea is book worthy. A proposal can be only a few pages long or several hundred.
The writer’s literary agent then shows it to publishers. The biggest are in New York. If the book is “hot,” it might spark a bidding war, like the Amanda Knox story. Of the ten nonfiction books that I’ve written, only one did that. I’ve also had one proposal that no one wanted to buy.
A publisher will make an offer, called an advance on royalties. Authors want to get the highest advance possible because the chances of earning a royalty are slim. About 80 percent of nonfiction books that are published lose money, at least on paper.
I saw an article in a trade journal recently that reported that the average advance for a nonfiction book was  less than $80,000. That is hardly $4 million.
Let’s say you got $80,000 for your idea, What happens to it?
Your agent takes 15% off the top. Which means that $80,000 is now $68,000. That still sounds promising until you realize that no publisher is simply going to write you a $68,000 check and wait for you to deliver your manuscript.
When I began writing books, it was standard for a publisher to pay you one-third of the advance to get started, another third when you finished the book, and the final third a year later when the book actually was published. Now some publishers are willing to pay half up front and half after an editor accepts it and the publisher’s lawyers sign off on the book’s content.
What this means is that the first check that a writer is going to get will be for $22,666.66 if the publisher pays the advance in thirds or $34,000 if it pays in halves.
Whether you take a week, a month, or seventeen years (which is how long Neil Sheehan reportedly took to write his much praised Vietnam book, A Bright Shining Lie) is your problem.
If you want to fly to Pocatello to interview someone, you pay for it out of that advance. If you need a new printer, it comes out of that income. So do your groceries!
Let’s say everything goes well and you finish your epic in a year. As mentioned before, you get the next payment and then a YEAR later, the final one, when the book actually is published. That is $68,000 spread over a two year period. 
You are now ready to enjoy the riches of royalties.
Hold on. Remember that the publisher gave you an advance on royalties.
What that means is that you must pay back the $80,000 that was advanced to you. (Yes, you are responsible for the 15% share that your agent collected too.)
Royalties are calculated according to sales. The author gets a percentage of the cover price (generally ten percent) in most royalty contracts. The percent goes up based on how many books get sold.
For simplicity sake, let’s say the author earned $2.50 in royalties for every copy of the book with a $25.00 cover price.
An average nonfiction book sells between 10,000 to 12,000 copies. That’s it. But let’s say your opus sells more than most –15,000 copies. That translates into $37,500 in royalties.
Yippee!
But when you get your royalty statement, you will discover that your $37,500 in royalties has been deducted from the $80,000 advance that you owe.
Which means that you still are in hock to the publisher for $42,500.
Only one of my books, The Hot House, pays royalties. That is because it has been steadily selling for an amazing twenty years.
I still owe money on every other book. Everyone.
So why would publishers pay me to keep writing.
The trick is that for every $2.50 that you earned on that hardback, the publisher earned $8 per book. Which means the publisher took in $120,000 overall in our example.
(If you want to know why publishers are complaining about e-books consider how much money they lost when that $8 per hardback revenue was reduced to a dollar or less for an e-book.)
Please don’t think I’m complaining. I love doing what I do and I have been blessed as an author.
But if you are thinking about quitting your day job to write a book and are dreaming of a huge paycheck, you might want to consider this – the average annual salary figure that I last saw listed for “writers/authors” was $42,000.
I wonder how that compares to used car salesmen?
PS:
Authors get a limited number of books for free. Between 20 to 30 when the book is published. After that, authors buy them just like you do off Amazon or Barnes and Noble.
Although electronic publishing is changing this, most books do not stay in print for more than two years. Some last less than six months. After that, you can only get used copies.
Because of the growing number of books being published, some are available in stores for only two weeks before they are returned to a publisher.
Despite all this, there were more than 300,000 new titles published last year.
And the number this year is expected to be even higher.

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