If you’re anything like me, you’ve spent a lot of your writing years dreaming of that moment when you’ll eventually be able to quit your day job and earn your living as a writer. This month I’m celebrating my one year anniversary of being just a full-time writer. (I was a full-time writer for years, while also working full-time at another job.)
Like all modes of living in the modern world, that writer’s dream requires money. Some people have sources of money that aren’t dependent on work. Some people have a partner in their life who can help pay the bills. Others of us are simply on our own, reliant on our work to keep ourselves housed and fed. There was recently a bit of a kerfuffle in the literary world when someone revealed what happened after they got that dream advance and weren’t really prepared for it. I want to offer a different perspective on how you can prepare yourself for your dream coming true.
Define the terms of your dream. It’s exciting and a little overwhelming when you sign the contract and see the dollar amount of that life-changing advance. While it’s tempting to play the lottery game and fantasize about all the things you could do with the money, before the first check arrives, you need to make plans. How are you going to live? How are you going to manage your money? How long do you need that money to last? My dream was to continue to live the same way I’ve been living the last decade or so, but without working two jobs. It was a fairly modest goal, and I knew how big of an advance I needed to embark on that dream. Defining my dream and knowing how much money I would need to put it in motion made it easy to pull the trigger when the opportunity came.
Hire an accountant and a financial planner. These are the two professionals who’ll help you implement the plans you make in step one, and it’s best to find ones who have experience with people working in the arts. You’ll need to be brutally honest about your living expenses, your obligations, and your goals. If you love eating out, don’t imagine that will change just because you want to suddenly become someone who can live off less. A financial planner will help you figure out long term strategies, but an accountant will help you deal with a lot of very important things in the short term. This was the cheapest thing I did to celebrate the book deal that let me quit my job. The first invoice from my accountant was less than the high end bottle of champagne I bought and, as delicious as the champagne was, I’m getting more out of my accountant.
Be business-minded. Depending upon where you live, forming an LLC or other business entity is one of the most important things you can do as a self-employed writer, and you’ll want an accountant to help you. An LLC can reduce your tax burden, and once your income starts arriving in the form of ill-timed large checks, that will matter. As a sole proprietor business with a single employee (you), you’ll cut yourself paychecks, and pay payroll taxes. All of these things will help you avoid nasty tax surprises. Courtesy of this planning and preparation, my taxes were done in March last year. I didn’t owe any surprise sums of money, and I didn’t lose a minute of sleep worrying. Also, it hasn’t cost me any of my naturally wacky artistic inclinations to own a business. After all, I named it after my dog.
Keep up on your insurance. If you previously had a job that provided you with health insurance, this can be a big leap, and it’s another area in which a professional can help you. There are some writers organizations that offer group insurance, but if you live outside their reach, as I do, an insurance broker can help you navigate the process of finding the best insurance and signing up for it. My old employer insurance was cheaper and had more benefits, but my current insurance helps me with the basics and provides some protection in case of a catastrophic illness.
Get back to work. You already know this from the query and submission process, but it’s worth repeating. It’s great that you sold a book for enough to quit your day job, but unless you got a multi-million dollar book deal, you need to be working on the next thing. After all, that’s the joy of quitting the day job: getting to sit around in your pajamas writing all day. The first week after I quit my day job, I went through all the projects I’d been toying with and decided what I would work on next. Then I got to writing. I have a book on submission right now that I finished in the last year.
Have a backup plan. Because I’m single, part of my planning involved doing the math on how long that advance would keep me afloat, and what would happen if the money ran out. Yes, I’m going to keep writing books, and yes, I think I’ll be able to keep selling them, but there are no guarantees my next advance will be as big as the last one. In fact, there’s a good chance it won’t be. Publishing is full of ups and downs. While defining my dream, I also decided when I would have to rethink things. It’s not an outcome I want, but I know down to the penny how low my bank account balance is allowed to get before I have to start searching for another job.
When I was younger, I imagined that there would simply be a magical day when I was a writer with a writing career. Now that I’m living the dream, I know it’s just another stage of adulthood. I have all the same annoying responsibilities, but I’m getting to do the work I love.
If your dream is being a full-time writer, what kind of plans are you putting in place? If you’re living your writing dream, what tips do you have for other writers?
About Bryn Greenwood
BRYN GREENWOOD is a fourth-generation Kansan, one of seven sisters, and the daughter of a mostly reformed drug dealer. She is the NYT bestselling author of The Reckless Oath We Made, All the Ugly and Wonderful Things, Last Will, and Lie Lay Lain. She lives in Lawrence, Kansas.
Totally sensible advice. I am forever grateful to the wise friend who told me to go and get a financial adviser and an accountant when I got my first substantial advance. Because of that advice and the way those professionals helped me manage my finances, I was able to ease out of the day job within a few years and support myself solely on my income from writing (like you, I’m single.) Thanks for explaining this so clearly.
It really can be terrifying to go it alone, so having a professional or three on your side makes a big difference. (And it feels like lately all we do is talk about what we shouldn’t do. ;)
This is such great advice! Do you think it’s important to find an accountant who has some experience with the publishing industry, or does that matter? I guess I have no idea how to go about finding an accountant or financial planner!
Meghan–I have a financial planner who specializes in authors and artists. He understands our crazy business. If you’d like his contact information you can reach me via Renee@reneerosen.com
Thank you so much!
As a lawyer, I’d like to second the advice that your accountant and other experts you consult have some experience in working with clients in the arts — I don’t think the experience needs to be specific to publishing, which is a narrow field. IRS rules are different for arts-based businesses than others; royalties are taxed differently than ordinary income; and the ebb and flow of income requires some experience to help manage.
Yes, as Leslie and Renee point out, it makes a difference to have someone who understands how crazy and unpredictable earning a living from the arts can be.
Wonderful and very important article! Thanks Bryn!
Thank you, Bryn, for sharing your wisdom and experience.
Really good advice, Bryn. I agree about the LLC, it’s very helpful. The thing I have to remember is that a single book can take longer than planned, even if you have one ready in the timeframe you allotted. Agents retire, editors move on, publishers reorganize. I’m not fond of selling more than one book to a publisher at a time, just for those reasons. I’ve been orphaned a few times, and I’d rather have the freedom to write what I like than be tied to a story I pitched that a new editor might not love. It gives me freedom, but it also puts a strain on cash flow. So your advice of knowing just how long money will last is very important.
Bryn, thanks so much for the positive spin and the advice. I read the article you’d mentioned and it took some of the joy out of having just sent a manuscript to my agent.
So happy to hear you have a book on submission! I just finished reading The Reckless Oath We Made, and loved it as much as All the Ugly and Wonderful Things. Can’t wait for the next one.