Self-publishing a book is one way to make money from home. If you have your own website, you can sell the book there and control its price. You can sell your book via your social media platforms. Or you can also sell your book via Amazon and other established online book platforms.
As someone who has self-published his own book about severance negotiations, I’m considering self-publishing a whole series of books. I figure, if we’re going to be stuck at home forever, we might as well create more products for online consumption.
My book was originally published in 2012 and is available exclusively on the Financial Samurai platform. Since publication it has gone through five updates. After 10 years, the book has generated over $500,000 in profits. Compared to the average book advance of $20,000 for a traditionally published book, my self-published book has done extremely well.
If I hadn’t slacked off, I could have self-published one book a year since 2012. If each book sold as much as my severance negotiation book, I would have made more than $1,000,000 by now. It’s too bad so much hard work is required to make money nowadays.
In this post, I’d like to compare and contrast the benefits of self-publishing versus traditional publishing. I’ll also delve more into how much you can make writing a book. I’m assuming we’re all trying to figure out more ways to make money from home.
The Benefits Of Self-Publishing A Book
The biggest benefits of self-publishing a book are:
- A sense of accomplishment. It feels great to go from idea to final product. After you’re dead, your book will live on. If it’s a great book, it will greatly help society.
- Potential recurring income. Once the book is out in the world, you can continue to generate income for an indefinite period of time. My book accounts for roughly 20% of my passive income a year.
- A way to build your brand. Once you publish a book, you get to be better known about the book’s topic. You may be invited to speak at conferences, get interviewed on TV, and so forth.
- You keep most or all of the income. You don’t have to pay the traditional publisher the majority of your cut.
The chances are high that millions of jobs will not be coming back once the economy fully reopens. In such a situation, you’ll be glad to have self-published a book that generates a recurring income stream.
Every Financial Samurai needs to build as many income sources as possible in this uncertain world. Relying on just your W2 income is simply too risky, especially if you have family to support.
How To Self-Publish A Book
Self-publishing a book today is easy. All you’ve got to do is:
- Write the book
- Edit the book
- Design the book art
- Publish the book on Amazon’s Kindle Direct Publishing, CreateSpace (for print on demand), iBooks, Barnes & Noble Press, Kobo, IngramSpark, Smashwords, or your website
- Market the book
- Swim in your pile of cash
OK, I’ve made self-publishing a book sound easier than it really is. The hardest part about self-publishing is finding the discipline to actually write the book. There is no editor pushing you to hit a deadline. The entire endeavor is all up to you.
Even after you finish writing the book, it may not be very good. You will likely have to revise your book many times before you are truly satisfied.
Once the editing process is done, then you’ve got to market the book. Some say marketing is the hardest part. It’s hard to make a living as a professional writer. Don’t let anybody tell you otherwise.
Marketing Your Self-Published Book Is The Hard Part
Unfortunately, books just don’t just sell themselves. If you’ve got an established platform, it’ll be easier to sell your book. However, you’ll likely still have to spend hours doing interviews, writing guest posts, and providing quotes to really get your book out there.
Thankfully, you can always hire editors, ghost writers, designers, and marketers to help you create and sell your self-published book. However, all this costs money, so there’s a tradeoff.
After writing both a traditionally published book and a self-published ebook, I can honestly tell you that the marketing process is often harder than the writing! You will be faced with a lot of rejections or non-responses, which will beat down your ego.
Take a look at this interesting chart from Statista that shows the growth of self-published books in e-book and print books since 2008.
Self-Publish Versus Traditional Publish
If your book is any good, self-publishing is a viable way to make good money from home.
However, every aspiring writer’s dream is to get published by a traditional publishing house. Today, the Big Five are Hachette, HarperCollins, Macmillan, Penguin Random House, and Simon & Schuster.
But in this technological day and age, perhaps going the traditional publishing route might not be the best way to go.
Thanks to the internet, you’ve got all the tools to self-publish at your finger tips. The internet has created “permissionless” endeavors for motivated people.
A traditional publisher will pay you a book advance over a two or three year period. Further, you won’t be able to make more money until your book sells enough copies to cover the book advance.
Advantages Of Self-Publishing Over Traditional Publishing
- Much easier to self-publish versus getting a book deal.
- Full rights and editorial control.
- Earn a much greater portion of the book sales.
- Might be faster to write and self-publish
All this being said, if you can land yourself a book deal with a Big 5 publisher, you should probably take it. A Big Five publisher should help with your book’s exposure as it gets your book into multiple distribution channels. However, big publishers unfortunately don’t put marketing dollars behind your book. Only a few anointed books will be backed by publishers.
Further, signing with a traditional publisher may provide a nice ego boost, help legitimize your brand, and help grow your business if you have one. A traditionally published book acts as a nice calling card and lead generator for your main business.
If you make a prestigious list, like the Wall Street Journal bestseller list, then you have the ultimate level of status and prestige. Less than 0.5% of all nonfiction authors make the WSJ bestseller list. In other words, it’s harder to get on the WSJ bestseller list as it is to get into Harvard by 12X!
How Hard Is It To Get A Book Deal?
Only between 1% – 3% of writers who submit manuscripts get book deals. We’re talking serious writers who are polished and put together great book proposals.
To sign a book deal with a traditional publisher, you often first need to get a literary agent. The literary agent might only select a handful of manuscripts out of hundreds viewed. Then the literary agent has to try and sell your manuscript to a publishing house, which also sees hundreds, if not thousands of pitches.
Despite the difficulty of getting a book deal, the 1% figure seems extreme. Supposedly over 300,000 books are traditionally published each year in America alone. It’s hard to imagine millions of manuscripts being written and pitched each year in this country.
Instead, Let’s assume the number of aspiring writers who get book deals is between 1% – 10%.
Then again, I’ve also read how some very qualified people have spent 10 years trying to get a book deal to no avail. Can you imagine toiling away on your masterpiece for 10 years with zero love? Maybe the percentage really is closer to 1%.
Bottom line: despite the sheer number of books being published a year, getting a book deal is still hard. Self-publishing is an easier route.
Here are some details thoughts on whether you should write a book at all. Writing one and getting it out in the world will be one of the hardest things you’ll ever do.
How Much Can You Make From A Book?
What everyone wants to know is how much can you make from a book.
In short, it depends on how good your book is, how large your platform is, and how good of a marketer you are.
A lot also depends on luck. If some famous celebrity like Oprah decides she loves your book, your book will likely be an instant bestseller.
How Much Can You Make – Self-Published
I’ve mentioned that my self-published book currently makes about $50,000 a year +/- 15%. I get to keep 97% of each book sale. The 3% goes to transaction fees.
I don’t do any marketing besides highlighting the book on Financial Samurai. Therefore, $50,000 is not bad since my book is so niche.
I mean, what type of person wants to learn how to negotiate a severance from a job they dislike to be more happy and free? We’re in a global pandemic! It’s time to buck up and work at your job for life!
But $50,000 is not that great since Financial Samurai has been around since 2009. If I was a better marketer, I could probably double book sales. I should try and get more bloggers to become an affiliate. Sign up here to be an affiliate.
The way I see it, Financial Samurai will be around regardless of how many books I self-publish. My book is only a small piece of Financial Samurai. Therefore, I might as well self-publish more.
Below is a mobile snapshot of my Paypal account highlighting three book sales on June 30, 2020, for $84.18 each after promo and transaction fees. If I can sell three books a day, I would make $7,576.20 a month.
Self-Publishing Average Income
Determining how much you can make from self-publishing is really difficult. For most self-published books, I’d guess a 50% range of between $5,000 to $10,000 a year. There are plenty of self-published books that make less than $1,000 a year. While some self-published books can easily clear multiple six figures a year.
Below is an interesting chart that shows how much an author gets to keep selling on different platforms. Amazon KDP and Createspace offer authors the least, but they are also the biggest platforms. Remember, I get to keep 97% of the sales price because I publish on my own platform.
Another issue with selling your book on another’s platform is that you have to follow their pricing guidelines. Can you imagine only selling your book for $9.99 when your book provides at least $1,000 in value? Further, platforms like Amazon may cut your book’s price at will. I’ve seen Amazon cut book prices to 99 cents before. That’s insulting if you put your heart and soul into creating your book.
Here is another chart that highlights the potential earnings based on 2,000 sales and 50,000 sales between traditional and self-publishing. Notice how the earnings for self-publishing are way higher.
How Much Can You Make Traditionally Publishing A Book
Even if you are part of the 1% – 10% that gets a book deal, the average book advance for a first-time author is less than $20,000. Some literary agents peg the number to be closer to $10,000. $10,000 – $20,000 for a first-time author doesn’t sound too shabby, if you can get it all up front. But that’s not the case.
Expect to pay 15% of the book advance to your agent. Given your book advance is paid in portions, you will only get 1/3rd upon signing, 1/3rd after submitting a final draft, and 1/3rd after the book is out. Some publishers pay out your book advance in quarters.
In the example of a $20,000 book deal, expect to receive roughly $5,666 a year before tax. At $5,666 a year, you would need to get three book deals a year just to be at the Federal Poverty Level Limit for 2020.
But what about royalties? Surely an author will make a lot of money on the back end.
Unfortunately, the majority (~70%) of books published the traditional way don’t sell enough copies to cover the author’s book advance. In other words, the book advance is the most an author will ever earn from his or her book. Therefore, I recommend every author negotiate as high a book advance as possible.
The downside to receiving a high book advance is that if the book doesn’t sell sufficient copies to justify the advance, the publisher may be reluctant to give you a second book deal.
A Book Publisher Is Like An Investor
In a way, a book publisher is like a venture capitalist. It knows most of its book deals will break even or lose money. But the books that hit will hit it big and contribute to the majority of profits.
Take a look at this chart that highlights how much some of the most popular writers made between June 2017 and June 2018. Besides writing great books, see if you can find any other similarities in the authors. In this day and age, you should.
Try Self-Publishing First
Given the lower barriers to entry, I recommend everyone try self-publishing first. You will learn a great deal about yourself and the book publishing process. Learning through self-publishing is very similar to learning through doing your own taxes.
Once you have self-published your book, you are a legitimate author. You can and should register your book with the U.S. Library Of Congress for copyright.
Once you are an accredited author, it may be easier for you to get a book deal with a traditional publisher. From there, you can compare and contrast the two.
Before you self-publish, just make sure you have your own online platform first. It can be a static site that highlights basic information about you, your business, and your services. Or, your site can be an organic site that regularly publishes new content.
When you go to market your book, you want to give the interviewers, the listeners, and the readers a place to find you. Potential buyers love to get to know their authors.
Perhaps more importantly, your website should serve as a gateway for bigger business opportunities. After all, very few people make a healthy living writing books.
Now if I can just find a way to self-publish more books. Then I could prove myself wrong and tell you how lucrative self-publishing truly is!
Related post on self-publishing a book:
Buy This, Not That: How To Spend Your Way To Freedom – This is my new traditionally published book with Portfolio / Penguin Random House. Order a hard copy on Amazon today. BTNT is also a Wall Street Journal bestseller!
Readers, anybody making money from self-publishing a book or going the traditional route? If so, please share your experiences. What’s interesting is that I have been offered a book deal by Penguin Random House, Portfolio imprint. It is hard to pass up.
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