by Linda Gilden @LindaGilden
To
find out more about Linda, her writing, and her ministry, visit www.LindaGilden.com. You can also connect
with her on Twitter and Facebook.
Reading a new writing
magazine, I came across the words “earn out.” Would I have known what that
meant just a few years ago? I’m not sure I would have.
You don’t usually hear the
words “earn out” until you get serious about publishing your work. “Earn out”
often accompanies words like advance, royalty, and payment.
As a new writer, the idea of
an advance was exciting to me. The publisher would pay me money before my book
was even in print. What could be better than that? But I soon learned an
advance was not without strings attached.
Here’s the thing. Yes, the
publisher paid me money before the book was published. However, that was not
bonus money. This is where the words “earn out” come in. The advance is just
that. It is an advance of the royalties (percentage of sales that I earn) of my
book. Once my book is on the market and it begins earning royalties, all that
will be applied to the advance. When the advance has been paid back to the
publisher, then I will begin to receive royalty checks. In other words, the
advance is loaned to you until your book earns the amount of the advance
through royalties. Once that has happened, your royalty checks will come regularly.
The publisher will keep you informed as to the number of books sold and the
amount of royalty earned toward the advance.
Some writers are disappointed during the earning out period. |
Some writers are
disappointed during the earning out period because they feel like they should
be getting royalties. But you need to regard the advance period as royalties that
have already been paid. You have been enjoying the benefit of that money before
your book ever started earning.
Other writers are
disappointed when they don’t receive an advance. But if you do not receive an
advance, you will earn your first royalty check in the first pay period after
your book is released or at whatever time your contract states. That is not
necessarily a bad thing. Either way can work to your advantage. With the
advance, you get some money sooner. Without an advance, you may get a slightly
higher royalty percentage.
Earning out is good
incentive for you to get out there and market your book. That will not only
help the publisher but will also get your message launched to readers all over
the world.
TWEETABLE
Linda Gilden is a wife, mother, and grandmother. She
loves to take one subject and create multiple articles from that information.
Linda finds great joy (and lots of writing material) in time spend with her
family. Her favorite activity is floating in a pool with a good book surrounded
by splashing children!
Linda, Thank you for the information. I am almost done editing my first book. One day I pray to be good enough to "earn out" Thanks again.
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