Thursday, October 9, 2014

Cash Flow for Writers

Dear Fellow Writer,

Anything is possible once you put your mind to it.

The above may sound like a cliche, however the phrase contains a profound ageless truth:

We create our own reality on a daily basis. We become what we focus on.

In this week's article, I explain how you will make more money by paying taxes on your writing income than you would if you simply squirreled away your 'pin-money' and didn't declare it.

It's just about seeing your life from a writer's perspective.


Keep writing! 

Rob@easywaytowrite.com


Cash Flow for Writers

Cash Flow for Writers

All experience of writing is good experience.

Practice at any kind of writing makes you better at every kind of writing.

Being able to edit, proof, compose articles, or create website copy, improves your ability to plot stories, develop characters, and maintain the head-space necessary to complete longer works like novels and nonfiction books.  

Don't say no to anything - even if a family member just wants a hundred copies of a flier from you or help writing a resume. It may only be $50 worth of work, but any money coming in looks good to your accountant and on your tax return.

When you’re building a body of writing work, and trying to improve your skill level, you can’t afford to think you’re above certain writing jobs.

When you write as a career choice then getting paid is a major concern.

You need money coming in to help pay the bills and to facilitate your ability to write your preferred work – especially if the work that is important to you is unpaid in the short term.

Simply put, if you don’t generate short term income as a writer, you won’t be able to sustain a writing career in the longer term.

Money is important as a tool to establishing your financial and creative independence.

As I explain repeatedly in Easy Cash Writing, money gives you leverage. It helps grease the wheels of your writing routine, and certainly helps maintain good relations with your spouse or other disbelieving family members.

Money from writing jobs helps prove to yourself and others that you have what it takes to be a career writer.

It’s just as important that you keep good accounts, no matter how small your writing income.

You’ll be far better off when you start paying tax on your writing income, because once you're paying taxes, there are many items you can claim as expenses.

Computers, all kinds of technology, travel, research materials like books, DVDs and software, can be claimed against taxable income if you declare your earnings, no matter how meager, to the IRS.

Robyn and I claim vacations, our cars, household bills, meetings with clients, and all our technology including cable TV, every book, DVD and digital product we buy, as tax deductible. 

The tax office has never once questioned us over this tactic - even when we once claimed a trip to Disneyland as research for Robyn’s children’s books.

The way we see it is that we're writers, so everything we do and see and experience is part of the multifaceted input we need to make us better wordsmiths.

Who can argue with that? 

Apparently not the taxman.

Writers need to keep their creative juices flowing. They need stimulation and inspiration coming in from any and every source possible.

In essence, once you have made the commitment to writing for a living, you’re a writer twenty-four-seven.

Self-discipline is crucial: in the proper allocation of your writing time and in maintaining good accounts of your income and expenses.

You need to be able to choose the right things to do at the right time and balance writing for money against writing for pleasure – hopefully finding pleasure in writing for money too!

Ideally, not all of your activities will involve writing but all of them will be writing-related. Resting, having fun, watching TV and going for walks can be writing related if you’re using the thinking time to improve your writing output and skill level.

Everything you do as a writer should be designed to keep you fit, active, and able, physically, mentally, and emotionally, to write for a living.

Don't feel guilty taking breaks and indulging in pleasurable research activities. 

Writers need breaks and external stimulation as well as periods of intense writing activity.

We also need software and electronic toys to help our creativity and output. 

Therefore these things are genuine expenses that can be offset against our incomes.

See it like this:

Imagine your writing career is an ocean liner: it's big, lumbering and powerful. 

When it's at sea, it's hard to tell whether it’s moving at all, but it is, assuredly, towards its destination.

But what happens before it gets out to sea - or when it needs to dock?

Even the biggest ship in the world needs little tug boats to guide it.

Think of your daily activities as the little tug boats that are guiding the ship of your dreams.

The tug boats don't need lots of power to move much bigger ships. They need momentum.

That's what your daily activities are providing: the momentum to drive or drag your large goals into the open water.

Be assured, with enough momentum and guided energy you can achieve anything you want.

When you work, rest, and play – and make sure you get paid and claim expenses against tax – you will find the right balance to maintain a new writing career.

As long as your main focus, of course, is the writing.

Keep Writing!

Rob Parnell

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