Contract and Money: Creator Reality Check
Elin Winkler wrote this post some time ago, My response was on the old blog and I thought it could use a repost. I am pretty sure I recall meeting Ms Winkler long ago. She is the publisher of Radio Comix, and has been on the alternative/manga scene for many years.
Here’s her frank look at the advances, contracts, and page rates young artists can expect today from some book publishers. As you see, the description of what some artists get is pretty grim. 20 years after I got started in the business, young creators are not making significantly more money than I was, with bigger companies that ought to have better resources at their disposal.
Moreover, in this era of creator rights awareness, creators are still signing away their rights for poor consideration. If you sign away your creations, that pay ought to include sufficient remuneration for that sale. $7500 a year ‘aint it.
Read all the way through the comments, because another reality check at the end of this missive is the fact that whatever your meagre earnings, those meagre earnings will be paying some taxes. As a self employed artist, you pay double taxes on social security – about 15 1/2%. Many’s the year I paid nothing in income tax because my income was so low, but I have had to cough up fat fees for social security payments. Even if you clear a measly $10,000, you’ll be paying about $1,500 of that just to Social Security. Add in state, local and federal taxes (after your standard deductions) that could come to another $1,000. So, with only $10,000 cleared, you pay $2,500 in taxes, leaving you a whopping $7,500 left to live on!
All is not gloomy, however. Say you pull in $20,000 per year as an artist – an amount suggested by a webcomic blog as a bare minimum amount an artist might expect to live on. (I can’t recall the link, but I do recall thinking a goal of $20,000 was a pretty bad goal minimum.)
Deduct your expenses for business use of your phone, computer, car, convention expenses, art supplies, etc, and you could easily add up a good $10,000 in legitimate deductions.
Wow! Cool! You get to spend money on new computer equipment and art supplies and not pay taxes on that stuff!
But you still had to pay for it all! You’re not saving any money! You have no money for health insurance! No money for emergencies, no real money to live on! Unless you want to spend your life living in your parent’s basement, you’re going to have some serious thinking to do in planning your future and considering the consequences of the contract you are signing.
It is not at all unusual for a moderately successful artist to have $15,000-$20,000 or more in annual expenses. When I had a self publishing mail order business, the fee to process credit card payments was about $100 a month alone (that was years ago and VERY high. There’s no reason you would have to pay that amount with Paypal and other services these days.)
Warehouse space, $250 a month. Long distance phone calls routinely ran over $100 a month (and for awhile, upwards of $500) until the phone company started offering flat rate long distance plans. Online computer access, about $65 a month. Shipping, about $250 a month. Federal Express shipping of art and computer discs on one book awhile back ran upwards of $300 over a couple of months all by itself. Ebay sales cost about $700 to ship over just a few months. A major convention will easily run $600-$800 in shipping costs for one show (one way), not to mention drayage fees if the show also requires you pay a union to handle your boxes.
Before getting into auto, travel, office, and supplies, the costs outlined above are just under $10,000 per year. Two major convention booth rents per year, add another $5,000. Legal and professional services, about $1,000 bare minimum.
I routinely have a good $20,000 in business expenses per year – at least – with or without self publishing costs from days of yore. Since I dumped the mail order business, I no longer have to warehouse, or pay online credit fees, and I rarely do conventions. But new expenses are things like $3000 for a scanner, $1000 on software, and a not-inconsiderable cost for licenses for use of photos for reference. You won’t have high equipment expenses every year, but you will need to make sure that money is there when the gods of Epson decide to take your expensive scanner back home to Jesus.
If you make $50,000 per annum and spend $20,000 on business, in reality, you only make $30,000 per year, and that is not exactly big bucks. After paying taxes on that, a moderately successful artist gets about $20,000 to live on.
So, when I see uninformed people online speculating about the high income of creators on monthly books – well, $50,000 a year only looks good to a college student, and $20,000 a year as an income goal is empirical evidence of amateur night antics. No professional artist can expect to make a decent living on less than $50,000 a year, because we are not just paying our personal expenses, we are paying business costs. If you happen to have a second income in your house and a supportive spouse, then maybe $20,000 works for you, and more power to you. But you will have a very difficult time supporting yourself on that if you are more than a year out of college.
Inquiring minds may want to know what the first thing is that gets paid out of Colleen’s royalty checks: my health insurance, dears.
Anthem has a great low-cost plan that serves me very well. And one of the advantages of being self employed is that 1/2 your health insurance costs are tax deductible from your income tax. 1/2 of your social security payments are as well. With standard deductions, and personal allowance, as well as the social security deduction, it’s likely beginning artists will pay no federal income tax at all.