Why Writing Books Is An Incredible Investment
For some reason, secondary school didn’t completely kill my interest in arithmetic. This article is going to be a basic guide to the arithmetic of being a writer.
A lot of people think that you have to starve if you’re a writer. A lot of people assume that you have to either make it big, like Stephen King or J.K. Rowling, or get a day job.
A lot of people also think that their job is wonderful because they get to save their money for retirement. They’ll put it in an ISA or retirement fund that gets a couple of percent per year.
The two thoughts above are interesting when you tie them together, so let’s do that in this article.
Before that, I’m going to talk about several thoughts on how to account for your time as a writer.
One way to think about writing is to think on a per hour basis. You sit for ten hours, you bill yourself or your client for ten hours. If you value your time at £20 an hour, then a ten hour writing session is worth £200.
Or you can think on a cost-per-word basis. If you get paid a penny a word (for easiness sake) then in ten hours you might write five thousand words (again, for easiness sake.) Those ten hours are worth £50.
You can also think in terms of projects – say you are a copywriter, and you charge £500 for a sales letter that also (conveniently) takes you ten hours. You’re looking at £50 an hour again.
Whichever one you pick, stick with it and go forward. Obviously, if you’re ghostwriting or otherwise working for a client, you’re going to have those terms somewhat set.
But you should be thinking in terms of a wage. How much is each word you write worth? How much is each project you do, and how much is each hour at the computer worth?
Those are questions which most writers don’t have an answer for.
Thinking About Time Invested/Your Pay
When I started working for myself, my first client asked me for a website. (This was before I was a writer.)
I spent about a month on that website. He then offered to pay me £20 for the thing.
I learned a lot of lessons there. Mostly, it was to agree to terms before you do the work!
However, there is very little that I could have done to make that worth my while. I spent a hundred hours or so on that project. If I earned minimum wage, the site would have cost £600+.
As a writer, I make sure to have a time period I’m going to spend before I start each project.
I don’t charge by the hour for clients, because that encourages me to spend longer than I sohuld on a project.
But I charge myself by the hour.
For instance, I’m writing this article. I’m never going to get back the time I spend on writing it – therefore I charge myself. If it takes me one hour to write a thousand words, then this post has to be worth it.
If the article is terrible and has to be re-written multiple times, then that is more hours I’ll have to spend on it.
I digress slightly but my point is that you have to think in terms of your time and your word count. That’s the only way you’re going to get accurate figures for how much your writing is worth and how to plan your writing.
If it takes you three years to write your first novel, and you’ve spent ten hours a week on it, then that’s fifteen hundred hours. If you expect to be paid ten dollars per hour in your day job and want to make a living as a writer instead, your first novel has to net you fifteen thousand over the course of its lifetime.
How realistic is that? You don’t know until you work out these figures.
Thinking in terms of a word count and time, you can optimize.
If I wrote 100 words a day on average, I wouldn’t consider myself a writer. It’d take two years to write a novel. Every word I’d write would have to go into a novel, and the novels I release would have to make enough for me to live comfortably off for two years at a time.
If I wrote ten thousand words a day on average, then I could write a novel or two every ten days. Following simple mathematics, I’d release about three novels a month, or thirty five or so per year. Each novel would have to support me for a few days at most. A much easier ask.
So, write quickly and well is the motto of this section, but I’ve written about that before. I’ll get to the point of the article in the next section though.
Your Writing Is A Piece Of Investment Property, And You Should Think Of It As Such
If you buy-to-let a building, you spend two hundred thousand pounds so that somebody can rent the property from you for a thousand pounds a month.
You take into account your mortgage, and then you take into account you’re going to have to pay for the upkeep, and you take that out of the thousand pounds a month you get. Say those together are just over four hundred. You’re left with six hundred a month left.
Take out some bits and bobs to make this an easy calculation, and you make six thousand in profit per year. That’s a 3% return on your investment.
(It’s also not a very good real-world example, but it’ll do.)
You should think of your writing in the same terms.
Let’s say you write a novel, and it’s one hundred thousand words.
You write one thousand words an hour.
It takes you one hundred hours.
You say to yourself, “I’m worth $50 an hour.”
Your time investment is therefore $5000.
If you sell the book for $10 and make $5 in profit, then you need to sell one thousand copies.
That might seem a lot or a small amount, depending on how far along the profitable-writer scale you are.
Break it down further.
Your copyright on this investment property (assuming you haven’t sold it to a traditional publisher,) extends for the rest of your life and until seventy years after your death.
Say you’ve got fifty years to live, and you’re going to donate your intellectual property to your favourite cat charity when you pass.
You need to sell 1000 copies of that novel in 50 years to make your real life wage $50 for the project.
That’s twenty copies a year of that book.
That’s realistic for any writer’s standard.
If you sell fifty copies a year, then you’re making $250 a year on that book. If you add that up over the course of fifty years, then you’re at $12500 in profit for that book. It’s not Stephen King or J.K. Rowling, but it’s more than double your investment. It’s also a 5% yearly return.
Better than a savings account.
It’s also a good place to start.
Closing Thoughts
It’s a good place to start because you have all the economic figures you need to improve your business.
If you put on your publisher hat and your business person hat, you can start to see where to cut corners, and how to get faster, and where to invest your time and money.
Are you more productive when you write short fiction or long fiction?
Is your hourly rate terrible because you watch TV all day and only write 50 words an hour?
Are you hoping you’re going to get a lottery style return on your investment and make a million from a single novel?
Have you sold your book to a publisher for a £5000 advance which means your book might not earn anything for the next two years whilst the manuscript sits on the shelf?
Are you not working enough hours in the day at your writing? After all, one hour a day might mean you get a novel written in a year. Three hours a day means three novels written in a year.
This mathematics is not only fun, but it’s good accounting. Most businesses operate with logistics in mind, and so should writers.