Passive Income

January 4, 2011

Something totally unexpected happened to me yesterday. I received a royalty check for the nonfiction book I co-wrote that came out in October. The fact that there were royalties to be had for me on a book that just came out in October says both something about the publisher and the success of the book in a very short period of time. It was a nice check, not earthshaking, but larger than I expected and I wasn't expecting it at all.

Partly I wasn't expecting it because I wasn't paying attention to the royalty schedule. Another reason I wasn't expecting it was because in many publishing contracts, you don't receive royalties until a full royalty period has passed, which is often 6 months (yes, boys and girls, if you want money from writing a book, get used to a twice-a-year paycheck, or someimes four times a year).

Anyway, go me.

Which isn't exactly the point of this post. I've been thinking a lot about what is sometimes called "passive income" for writers. That is to say, I write many things that are work-for-hire, which means I write something, I get paid, I cash the check, I'm done. That's fine. Works well for me, for the most part.

Even most of the books I've had published have not really resulted in significant royalties. There are a number of reasons for that, but slow sales and an inconsistent publishing history are two of them. Slow sales are obvious, I think, but an inconsistent publishing history may not be.

What I mean is, I would publish a book, then I wouldn't have another one come out for a couple years. They'd go out of print or just sort of lie there, fallow. Then I'd start all over again. Hopefully these days I'm publishing at least a novel a year. Thanks to e-publishing, more than one a year, generally speaking (I'll get to the e-publishing thing in a moment). When you publish at least one book a year, the new books generally help promote your old books, AKA backlist, so you get some money coming in on royalties (hopefully). That's nice, because you didn't actually do any work, but it brought in money anyway. Yay!

Which is one of the interesting things about the e-books I've got out--they seem to be growing, they bring in money direct-deposited to my checking account at the end of each month, and although to-date it's not astonishing money, I actually am using it for something. Recently I'm depositing it into my retirement account, although I've used it to pay bills or buy stuff in the past.

It's nice to move a bit off the work-for-hire treadmill and I think it's a worthwhile thing for writers to push toward. Advance checks and work-for-hire projects are fine and I don't have plans to move away from either of those fully, but it's quite nice to receive money--again!--from a project you finished quite some time ago.

Thoughts?