As I later learned from a literary agent on Twitter, a general rule of thumb is that your publisher starts making a profit when you’ve earned out 50% of your advance. But it quickly became more than that.Ĭreating the calculator helped solidify a truth I hadn’t really believed before: that you don’t have to earn out to be a sound investment for your publisher. When I created the “When Do I Earn Out?” calculator, it was with two goals in mind: to automate the math so I wouldn’t have to do it again, and to make it easy for my fellow authors who didn’t want to do math at all. Some people decided the math was beyond them entirely and they would just have to live without knowing “their number.” A few people started quietly panicking over whether they’d ever hit the numbers they were seeing, and if they didn’t, how long it would take before publishing declared them a failure. The numbers seemed ludicrous, especially for the authors with advances in the six figures. The server quickly filled up with shocked and crying-laughter emojis. When the discussion came up one day, people in the group started doing math to figure out how many copies they’d need to sell to earn out. My debut group, 2024-Ever, was no exception. Sooner or later, every debut group starts talking about earning out. When the amount you’ve earned in this way equals the advance your publisher paid you, you’ve earned out - and the royalties start being paid directly to you on a regular basis. Every time someone buys a copy of your book, you earn a percentage of the money from that sale in the form of royalties. The “advance” your publisher pays you is an advance on your future royalties. If you’re a traditionally published author or hoping to be one someday, you’ve probably heard of “ earning out.” What does earning out mean, anyway? Photo by Iryna Tysiak on Unsplash of a planner with pencils, pens, an orange, and a calculator.
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