Depending on how we want to define "success," a successful writing career is not just about lots of contracts or great reviews. (Although those things certainly help.) A successful writing career is about making a living at doing something you love. That requires making the right financial choices every step of the way. Certainly from the point you receive that first 4 digit royalty check.
Here are 5 very simple things you can do now that will make a big difference down the line.
1 - Clear your credit cards. We all go through that little cushion we put together before we jumped ship very fast, and inevitably we start to live on our credit cards. At one point my cards were up to slightly over 20K with (in some cases) nearly 30% interest. I stopped sleeping nights, as you can well imagine. My cards are now clear. It was not easy. It was brutal, in fact, but I made clearing them a priority before everything else. Clear your cards and pay off your cars. Do that before you even think about investing.
2 - Open a Roth IRA. Or, if you're still working a day job, up your 401K contributions to the maximum you can afford. This solves two birds with one stone: you plan for your retirement (even writers have to slow down eventually) and you give yourself tax deductions. The tax deductions can be vital once you're earning real money -- especially if you've got a spouse working a day job. Ironically once writers start to earn income, they fall into the worst possible tax bracket -- not rich enough for a lot of loopholes (the deductions for Netflix, etc. only take you so far), but not poor enough to avoid taxes altogether.
3 - Open a savings account for emergencies. And then don't touch it unless the emergency is really and truly an emergency. The best way is set it up for automatic deposit so you don't even think about it, you just do it. Just put something in, even if it's a minimum of $20. a month. Get in the habit of saving.
4 - Get health insurance coverage. If you're lucky, you'll have a SO working a day job that provides health insurance. But either way, get yourself some coverage because nothing will wipe your savings out faster than a serious illness. Or even a semi-serious illness.
5 - Take 10% of everything you earn and invest it back into your writing business. You're self-employed. Invest in your own business. Take that money and use it on whatever it is you need -- research materials, a writing course, a new laptop, even advertising. Whatever it is you need to "grow your business." Invest in your career
And, finally -- though this is an option because our industry is changing so rapidly -- contract for work 1 - 2 years into the future. (No more than that.) Having contracts gives you a rough idea of how to pace yourself and how much income you'll be bringing in. Ideally, you'll do better each year, but it's good to have an estimate of what the minimum you might bring in is.
Anyone else feel like sharing their financial tips?
