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What Would It Take?

5K views 50 replies 30 participants last post by  Kay Bratt 
#1 ·
So I read a post like this on 20BooksTo50K and I always enjoy them, so I thought I'd ask the question here!

For those of you not full time, what would you need to achieve to go full time? What's your necessary monthly income, (with or without expenses)?

If you don't want to go full time, what do you need to scale back in your current career?

Already full time? What personal goal did you hit to achieve this? What do you think made it possible?


I always find these threads so inspiring, and I'm in a writing slump at the moment, so thanks in advance for the motivation!

My goal is $4k a month before I can quit my current non-career. Healthcare is free where I live so that's no biggy, and I have zero dependants!  8)

Well, except my dogs, but I think I depend on them more so than the other way around.
 
#27 ·
RightHoJeeves said:
Bizarrely (and it is not my intention to wade into politics here), we seem to pay less tax than Americans.
Like you, this thread made me curious, so I did a little searching around. According to the sites I found, the U.S. has one of the lower tax rates. However, what I didn't find was what taxes were being compared. Just income tax country to country wouldn't do it. Here in the U.S., you'd have to average what one would pay state to state and even locality to locality because things like state income taxes and state and local sales taxes vary so much. Property taxes, gasoline taxes, etc. I don't know much about non-U.S. countries' taxes, but VAT taxes look stunning to me (and like withholding tax in this country, they're built in so that no one has to write a check and have it driven home exactly how much they pay). Apple to apple, orange to orange comparisons would be a huge and complex project if it could be done at all - or ever has been.
 
#29 ·
kw3000 said:
In Canada we pay taxes on all produce.
egad, so, even comparing apples to apples, one needs to determine if the apple was taxed or not. ;D

I find folks' experiences to be very informative. I appreciate especially those who have made the transition to full time.
 
#30 ·
ellenoc said:
Like you, this thread made me curious, so I did a little searching around. According to the sites I found, the U.S. has one of the lower tax rates. However, what I didn't find was what taxes were being compared. Just income tax country to country wouldn't do it. Here in the U.S., you'd have to average what one would pay state to state and even locality to locality because things like state income taxes and state and local sales taxes vary so much. Property taxes, gasoline taxes, etc. I don't know much about non-U.S. countries' taxes, but VAT taxes look stunning to me (and like withholding tax in this country, they're built in so that no one has to write a check and have it driven home exactly how much they pay). Apple to apple, orange to orange comparisons would be a huge and complex project if it could be done at all - or ever has been.
I just googled "California income tax calculator", put in an income and it calculated all the federal, state and local taxes. It was roughly on par with what Australians pay (although we don't pay "state tax". I think it all goes to the feds for simplicity and they distribute to the states)
 
#32 ·
RightHoJeeves said:
I just googled "California income tax calculator", put in an income and it calculated all the federal, state and local taxes. It was roughly on par with what Australians pay (although we don't pay "state tax". I think it all goes to the feds for simplicity and they distribute to the states)
When I lived in Tokyo, at first I was like whoa, tax is so cheap here compared to Aus but then we pay everything in our income tax whereas in Japan you have to pay compulsory health insurance and local government tax separate - and they can sure add up. Australian taxes, if you are a salary earner, are way more simple.
 
#33 ·
RightHoJeeves said:
I just googled "California income tax calculator", put in an income and it calculated all the federal, state and local taxes.
Yes, but calculations like that don't show the total tax burden for a citizen making a given income because there are a lot of taxes other than income taxes. As a for instance, my property taxes are roughly equivalent to my income taxes. Since I retired, I pay more in Social Security and Medicare taxes than in income tax (because of book income). Sales tax hits pretty much everything I buy. There's tax built in to all sorts of things like auto registration, license, gasoline. So the total tax burden on any person is going to be very different from merely their income taxes. And I think that's true in every country. My quick Google search shows Australia as having over a hundred different taxes of one kind or another.

Back to the original question of this thread. I'm retired and don't plan to ever "make a living" from my books. They provide supplemental retirement income, and I don't begin to have the oomph to do the equivalent of writing as a full time job. However, in making the calculations of how much a person needs to be a full time writer, individual circumstances are going to play into it. Someone living in California or New York with a family is going to have very different needs than a single person living in Texas or Florida. Or maybe not if the family person likes a quiet homebody life and the single person likes to travel and never eats at home.
 
#34 ·
I quit when I was making about $5000/month & never looked back. But I've got a pretty high risk tolerance. Also I figured that that amount was a lot more than many people make at their day jobs. When I read numbers like $10000 or more a month I have to wonder what ya'all do for a day job! Mine made good money but nowhere near some of these levels being mentioned.

I get that a job feels more secure than self employment but I came of age in my career during the recession so I know from experience than a job does not equal security. Sadly it can be gone tomorrow w/ not so much as a 'thank you for the time you spent being our wage slave.' I get that some jobs offer benefits & I had those as well but again once the job goes, so do they. I find true security in being my own boss & making my own money, rather than in making money for other people.

I don't regret a thing & I've never been happier. To me, pursuing what I loved with all my energy was worth more than the soul sucking career I gladly left. Of course, I did have some fear & doubt but I just told myself I could always head on back to said soul sucking career if god [Zon] forbid I should ever need to. Luckily that has never happened & if tomorrow Zon decided to shut down KDP I would likely try something else before going back to what I was doing before. I've learned a lot about business & marketing from this gig that I think I could apply elsewhere if need be. Maybe a combo of my old career & my marketing knowledge would work out for me. But I honestly can't see myself ever working for anyone but myself ever again.

I don't post here much but I just felt like encouraging those of ya'all who might feel discouraged by some of the posts in this thread. I know that other people posting are more level headed or practical & that a lot depends on your own personal experience & responsibilities & goals. But I just think life is too short to not do what you love so once I found out self publishing existed & that I was half decent at it, I was all in. It was perfect for me since I always said I wanted to be a published writer. But I assumed that meant a starving one or a hobbyist. Ironically only once I let go of my fear that I wouldn't be successful at doing what I loved & that I wouldn't have enough money, I became even more successful at it & made even more money. Probably because I had to, since the alternative was going back to that soul sucking job & admitting failure. Good luck to everyone else going down this exciting path. I wish you all the best!
 
#35 ·
ellenoc said:
Yes, but calculations like that don't show the total tax burden for a citizen making a given income because there are a lot of taxes other than income taxes. As a for instance, my property taxes are roughly equivalent to my income taxes. Since I retired, I pay more in Social Security and Medicare taxes than in income tax (because of book income). Sales tax hits pretty much everything I buy. There's tax built in to all sorts of things like auto registration, license, gasoline. So the total tax burden on any person is going to be very different from merely their income taxes. And I think that's true in every country. My quick Google search shows Australia as having over a hundred different taxes of one kind or another.
My point was really just in relation to healthcare. Obviously comparing the exact amount of tax we each pay is very difficult. All I was getting at is that Americans and Australians pay roughly the same amount of income tax (or so it seems to me), but Australians don't have to worry about healthcare on top of that tax burden. That would impact ones decision to go full time.
 
#36 ·
RightHoJeeves said:
My point was really just in relation to healthcare. Obviously comparing the exact amount of tax we each pay is very difficult. All I was getting at is that Americans and Australians pay roughly the same amount of income tax (or so it seems to me), but Australians don't have to worry about healthcare on top of that tax burden. That would impact ones decision to go full time.
There are sites that compare overall tax burdens by country (all taxes counted in). Americans pay relatively low tax compared to Europe, but about the same as Australians. Even if you had to pay for your own healthcare in cash, it would be about half what it is in the US. (I have had a lot of Australian health care.) So, yes, health care is a huge chunk.

Re another post here: 10k self employment is not the same as 10k corporate employment. Hubby's job did away with the need for health insurance of about 3k per month at the time (we were insuring our son also), and provided about 700/month in 401k) match and profit sharing. Then there is self employment tax, sick time, disability insurance (I have been on that four times in my life), etc. The estimate is 30%. So if you are replacing 5k/month, you need to make about 6.7k/month on your own to replace it (assuming your job has benefits).

Your risk tolerance if you are young, healthy, and have no dependents (especially if you are not in the US) will probably be much greater than if you have a mortgage and kids, especially if you are the sole breadwinner and/or live in an expensive, high-tax state. I too threw my job out the window when I started writing fiction (tired of the job, loved writing), but I already worked for myself, my kids were through college and out of the house, and my husband was both still working and willing to tighten our belts. He told me to take a year without thinking about getting a job and then see where we were. As it turned out I got so sick I could not have done my job and would have been up the creek good without his great health insurance (6 figure hospitalization alone), but I wrote through almost all of it. Got better, published, made day job money right away and then made 5x then 10x day job money. But it still took years and paying off the mortgage for hubby to quit his own high paying, secure job. He had been unemployed for 7 months when our kids were 2 and 5, and the experience cut deep. If we had lived in a country with health care and a safety net, he probably would have quit 2 years sooner. As it is he finally retired at about 72, which has been cool.

Everybody has a different life situation, but publishing can change fast. In the era of KU1 shorts, serials, and NA romance, many writers got in over their heads financially thinking the good times would last. As others have said, it also depends how replaceable your day job would be.
 
#37 ·
There is a very wide variance of cost-of-living in the U.S.  If you were to take the average U.S. household income (about $75,000), you would barely be getting by in some areas, and living pretty comfortably in others.

Consider where I live, in a mid-city in the Midwest. Our average rent for a 1000 square foot apartment is about $700, and if you know where to look, you can get a nice, clean safe 1,000 square foot apartment for around $500 a month.

Gas is currently running about $2.30 a gallon, and the price of food is low.

While the average U.S. household income is around $75,000, the average for my State is around $38,000, and the average for my metro area is around $34,000. So a $10,000 a month income from book sales would put me in the top 10% of incomes in my area. Even at $5,000 a month, I would be well above average in income for my area, even with paying both sides of social security and health insurance.

It just depends on your situation as to what will work well for you.

 
#38 ·
Amanda M. Lee said:
I think everyone always lowballs these threads. In truth, I think it's far more likely you'll need double what you think you'll need.
Keep in mind several things (and not all of these are pertinent to the OP but often need to be addressed by others):
1. Taxes
2. In the U.S., you are responsible for paying both parts of your Social Security when you're self-employed.
3. Insurance.
4. Money that needs to be funneled back into your business to make it profitable.
5. If you're constantly worried about money then you won't be at your creative best.
6. You need a big cushion before going full time in case you have an emergency of some sort that requires funds. What happens if your vehicle breaks down or something? What happens if you have a bad few months selling books?

I kept my day job a lot longer than other people would have. When I decided to quit I was making 30K a month from Amazon. I stayed another six months so I wouldn't ruin anyone's Christmas vacation (even though I was working 80 hours a week). I also put away a six-figure cushion. By the time I actually quit I was making more in a month than I made in an entire year at my day job. I wanted to make sure that I was making the right decision because there was no going back. I've seen a lot of people quit after one good month and then get forced to take another day job when things don't turn out as they thought. Going full time takes a lot of planning.
On the other hand, if you'd quit after one month instead of six, you probably could have written more and made more even more. There's an opportunity cost to keeping your job. That's a lot of time you can't spend writing.

I didn't quit my job so much as stop looking for a full-time job. I had been underemployed, perpetually working different gigs since college, and I was tired of it. I wanted to give writing my all before I "gave up" and retrained for a job in a more secure field. I gave myself a year to hit 3k/month with the goal of getting to 5k/month by the end of the next year. The 3k/month wasn't what I needed. It was more a proof of concept. I made it by September and have cleared it every month since (usually by quite a bit). At the time, my hubby (then fiance) and I had a nice cushion because of his job, and he was happy to support me for awhile, so it wasn't as big a deal. Now I support him, so it worked out pretty well for both of us.
 
#39 ·
Usedtoposthere said:
There are sites that compare overall tax burdens by country (all taxes counted in). Americans pay relatively low tax compared to Europe, but about the same as Australians. Even if you had to pay for your own healthcare in cash, it would be about half what it is in the US. (I have had a lot of Australian health care.) So, yes, health care is a huge chunk.
I'm not sure what you mean by this. If you don't/can't pay for health insurance, you don't pay anything for healthcare. Are you referring to health insurance or the actual care?
 
#40 ·
RightHoJeeves said:
I'm not sure what you mean by this. If you don't/can't pay for health insurance, you don't pay anything for healthcare. Are you referring to health insurance or the actual care?
Sorry was not clearer. I meant that Americans can go bankrupt and often do when they are uninsured or underinsured, because not only do we lack universal health coverage, our health care is also twice as expensive as in Australia on a fee for service basis. (Such as a non-Australian would pay in Australia.) Not only do we pay a ton in insurance, even an insured person can easily be on the hook for an additional 5k or 10k a year. So for somebody like me, I could pay $36k a year to insure my family and another $10k that year if we maxed out the out of pocket expense. I have one medication that costs me $300 a month WITH insurance.

The government was trying to help with that with the Affordable Care Act, but now its provisions are being stripped. So, folks--do not underestimate how much health care can cost you when you run your scenarios. Make sure you can cover both your premiums AND your out of pocket max before you quit a job with benefits. Especially if you have kids.
 
G
#41 ·
I would need to make an additional $90,000 a year to offset the loss of not just my salary, but health insurance, 401K, profit sharing, personal development training, paid vacation, and assorted freebies I get at the day job (yeah, I'm spoiled!). Not to mention covering the self-employment tax. Sure, I COULD live on less, but frankly, I like having a nice life and feel no need to live on less income just to say "I am a full-time writer."  :p
 
#42 ·
I dropped down to part-time in consulting when my profits were up to 4K a month, and completely dropped my consulting after profits reached 5K a month.

However, my husband and I really worked our butts off before we had kids. We worked 80 hour weeks for years and had more than a years worth of savings in the bank. We'd also maxed out our 401K options.

A huge issue in the states is health care. OP, you have no idea if you're in Canada. It's really expensive here, and you can go bankrupt quite easily even if you have insurance. Some of the plans have super high deductibles. Sometimes insurers won't pay if they feel like you shouldn't have gone to the emergency room. Sometimes you can wind up in a feud with your insurance carrier if the ambulance took you to an out of network hospital when the insurer feels like an in-network hospital was equidistant. It's a total mess. (For the latter occurrences get on social media and cry your heart out, make sure to contact your senator, too, and of course, file an appeal ... you may also need legal representation; I'm not sure if paying one bill automatically means that you acknowledge you are at fault. Of course, this will kill your credit.)
 
#43 ·
Agreeing with Usedtoposthere, C. Gockel, and others.  Even if you're young and single, if you plan on having kids someday, know that your cost of insurance in the US will be a Big Deal.

My real life numbers: We pay $585/month ($7,020 yearly) on our insurance plan.  The deductible is $600, we have $25-50 copays, and our out of pocket maximum is $5,500 (no, those monthly payments don't count). That sounds like a lot, but bills for delivering my first child amounted to more than $20,000.  After insurance, we paid around $2,000, and that's just for a healthy baby.

...A healthy baby who went on to develop a 10-day mystery fever that required a 3-day hospital stay at nine months of age.  It was two and a half weeks into the next calendar year, so the out of pocket max had reset.

And our insurance is actually pretty good, because I know people who owe $10k after insurance for emergency cesarean deliveries. If you live in the US, do not underestimate your potential medical bills.
 
#45 ·
writerlygal said:
I quit when I was making about $5000/month & never looked back. But I've got a pretty high risk tolerance. Also I figured that that amount was a lot more than many people make at their day jobs. When I read numbers like $10000 or more a month I have to wonder what ya'all do for a day job! Mine made good money but nowhere near some of these levels being mentioned.

I get that a job feels more secure than self employment but I came of age in my career during the recession so I know from experience than a job does not equal security. Sadly it can be gone tomorrow w/ not so much as a 'thank you for the time you spent being our wage slave.' I get that some jobs offer benefits & I had those as well but again once the job goes, so do they. I find true security in being my own boss & making my own money, rather than in making money for other people.

I don't regret a thing & I've never been happier. To me, pursuing what I loved with all my energy was worth more than the soul sucking career I gladly left. Of course, I did have some fear & doubt but I just told myself I could always head on back to said soul sucking career if god [Zon] forbid I should ever need to. Luckily that has never happened & if tomorrow Zon decided to shut down KDP I would likely try something else before going back to what I was doing before. I've learned a lot about business & marketing from this gig that I think I could apply elsewhere if need be. Maybe a combo of my old career & my marketing knowledge would work out for me. But I honestly can't see myself ever working for anyone but myself ever again.

I don't post here much but I just felt like encouraging those of ya'all who might feel discouraged by some of the posts in this thread. I know that other people posting are more level headed or practical & that a lot depends on your own personal experience & responsibilities & goals. But I just think life is too short to not do what you love so once I found out self publishing existed & that I was half decent at it, I was all in. It was perfect for me since I always said I wanted to be a published writer. But I assumed that meant a starving one or a hobbyist. Ironically only once I let go of my fear that I wouldn't be successful at doing what I loved & that I wouldn't have enough money, I became even more successful at it & made even more money. Probably because I had to, since the alternative was going back to that soul sucking job & admitting failure. Good luck to everyone else going down this exciting path. I wish you all the best!
Nice advice, Writerlygal. This sounds a lot like my experience. As soon as I had one month where my earnings were equal to my salary, I quit my job.

I was very determined to make a go of things and was willing to write to market and understood the requirements of marketing. I also hated my corporate writing career. I just wish I'd known self-publishing was a thing several years earlier, and grasped genre fiction in general.
 
#46 ·
kw3000 said:
Holy cow, this seems untenable. I'm not sure how you guys do it.
It's a major concern for self-employed people here, for sure. I went to the ER a couple months ago for something that seemed scary but turned out not to be a big deal. Had maybe four hours of monitoring and an ultrasound. Just got the largest statement in the mail: about $21,000. My insurance had negotiated with the hospital and brought the bill down to $7,000, which they'd paid. I only had to cover a $50 co-pay. But if I were uninsured, you bet the hospital would be trying to get $21,000 out of me right now.

Buuuut ... it's not something that can be fixed on KBoards, and the issue is extremely contentious here in the U.S., so let's not get too into the political weeds. :)
 
#47 ·
Canada has about the same rate of medical bankruptcy as America because it's being unable to work that makes you bankrupt, not medical bills (which in America are frequently written down or written off in such cases).

I agree that people tend to underestimate self-employment costs, but health care payment in America is a complicated thing (basically 50 different approaches and about as many kinds of safety nets) and bankruptcy or difficulty paying is sufficiently infrequent that I don't even consider it relevant to going full time. 

Retirement is very relevant, though, because the easiest way to have enough money to retire is to save enough money each year that you can afford to stay in lower-risk investments.  Chasing returns is time-consuming and a lot of people undersave for retirement thinking they can just chase returns. 

That said, it also depends on if you're going full time by yourself or with other people.  Having a writing partner(s) can smooth risk, but it adds another layer to earnings issues.  But a lot of people also try that one, rushing into full time because they can split up the work.  I've been seeing more partnership approaches to self-publishing among people interested in doing it full time.

I have two numbers for going full time, the "full time as fun paying hobby" number and "full time as a real business" number.  One is substantially larger than the other, and if I go with the bigger one, the small number works as a good test case for doing full time effort.       
 
#48 ·
There's a rapidly diminishing list of things I'm proud of in Britain, but the NHS is probably our greatest achievement.

I can't imagine worrying about health care bills like that.

Just to chip in on the going full-time thread. I had a 'ful-time before 40' plan which gave me three and a half years. I've started better than I expected though so I'm starting to dream it could happen sooner!

I'm aiming to sell 20,000 books a year before I seriously consider it.
 
#49 ·
Usedtoposthere said:
Sorry was not clearer. I meant that Americans can go bankrupt and often do when they are uninsured or underinsured, because not only do we lack universal health coverage, our health care is also twice as expensive as in Australia on a fee for service basis. (Such as a non-Australian would pay in Australia.) Not only do we pay a ton in insurance, even an insured person can easily be on the hook for an additional 5k or 10k a year. So for somebody like me, I could pay $36k a year to insure my family and another $10k that year if we maxed out the out of pocket expense. I have one medication that costs me $300 a month WITH insurance.

The government was trying to help with that with the Affordable Care Act, but now its provisions are being stripped. So, folks--do not underestimate how much health care can cost you when you run your scenarios. Make sure you can cover both your premiums AND your out of pocket max before you quit a job with benefits. Especially if you have kids.
I understand now. Thanks for clarifying.
 
#50 ·
Personally I would seriously think about it when/if I hit 7 K a month and can do so for every month for six to eight months. Both me and my wife work so I could get health care through her job so it would be doable at that point. It would require some serious adjustments to our schedule and lifestyle to adapt to me being a full time writer though.
 
#51 ·
Besides hitting a certain threshold for at least a year, I'd advise having a big savings put aside before leaving your outside job. Just this month I had $3k in bills come up for a septic tank problem and an unexpected legal issue, which will probably continue to cost me money for some months. You just never know what is going to come up in life so don't cut it too close. 
 
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