Are you curious about a one-year delay? I explained it in my first income report.
February 2017 was slow and uneventful. I kept writing the usual mishmash – Quora answers, blog posts, email broadcasts to my ever-growing list; articles and guest posts when I got inspiration to write them, and my novel written on Sundays for the sake of keeping a writing streak intact. One thing I focused more on were my income reports. I decided to catch up with them and close the time gap between their publication and the events they described.
In the end, I want to keep about a 3-month delay to keep things fresh, but reliable at the same time. In self-publishing, the cost side is easy to figure out; costs are immediate.
The income side is trickier. Money from your Kindle sales can arrive up to three months after the sale took place. The same is true with other streams of income. For example, there is an inevitable delay between an affiliate sale and commission.
In 2016, I hired an accounting firm to help me report my royalties income to the tax office. They did an OK job, but they charged me an arm and leg for that. By “OK,” I mean they prepared methodology and an Excel sheet that summarized it for all 12 or so countries I had theoretically got royalties from. “Theoretically,” because in the end, I got all the money from Amazon.
Anyway, they not only made several calculation errors, but they also made a mistake in some tax regulations. A few months later, my tax office guided me on how to fix them.
So this year, I outsourced the job of calculating my taxes to my son. At the beginning of February, we went through his report. He made fewer mistakes than the accounting firm.
1. When you have the right processes, even a kid can do the job.
I don’t regret hiring the accounting firm in the previous year because they provided me with that Excel sheet that served as a baseline for my son.
2. Tax regulations are purposefully complicated.
Small business owners fear tax authorities like a plague, so they go to lawyers and accountants for help. The complexity of regulations serves only those service providers. They can charge premium price for their “magic formulas.” But even they don’t know all the ins and outs, so outsourcing doesn’t make you safer, but leaves you poorer.
You need to take responsibility for your taxes, because no one else will.
3. Set aside money for your taxes.
I’m so glad I did just that. Till 2017, every year I got a hefty tax return because of relatively low income and family tax preferences. This year was the first time I had to pay the back tax. However, in 2016, I was willfully setting aside some percentage of my royalties exactly for this purpose. It was no problem for me.
I’m a one-man army. I have no backend for my business. No leads, funnels, system and processes. It takes time to build them up, and I had enough in my lap to be fully scheduled.
I was corresponding via email with one of my readers. He asked me if I provide personal consultations. I could, why not? I called him one Saturday morning, and we chatted for about an hour. I told him about Coach.me’s accountability coaching, and he was eager to jump in. I also explained to him my philosophy of Pay What It’s Worth, and he agreed on that as well.
The consultation and the first couple of weeks of PWIW coaching provided me with $375. Now, half a year later this client is still with me, and he has made some impressive progress.
I sell hundreds of copies of my books a month. I need to put info about consultations and coaching in the back matter, I think. :/
Moving my blog
In the first week of February 2017, I was busy establishing my blog on a new server. I had to park my domains there, configure email accounts, install WordPress, and all that technical stuff.
I can say only good things about Bluehost’s support. Their interface was clear and relatively simple, and the one time I couldn’t figure out the problem, they were very responsive and solved the problem during a single call.
Coaching and Amazon Ads
Apart from getting my first PWIW client, the certification on Coach.me brought an additional trickle of new clients. My income reflected that; my coaching fees grew by 15% month to month.
I created only three new AMS ads, including one for my speed reading book that used keywords from already-running campaigns from other books. I spent only a few hours researching keywords for those campaigns.
I continued dabbling with small neglected activities destroyed by procrastination.
I finally included reviews of my readers on my permafree books’ pages in “Editorial Reviews” sections. I contacted my friend who designed Directed by Purpose‘s cover, and we worked slowly on a new version of Making Business Connections… cover. Its sales tanked a bit, and I hoped to put some new life into the book.
A Record Month
Income-wise, it was my best month ever. A few things contributed to this: the PWIW coaching client, Kindle royalties from December that was a very good sales month, and paperback royalties from January when the pricing trick still worked. Besides, January 2017 was even better sales-wise than December 2016.
My Kindle results were especially impressive. They jumped from $500 to $1,500 between November and December. I attribute it in great part to the fact that I pulled out my books from KDP Select and Kindle Unlimited program. It appears that most people who borrow “para-free” nonfiction books via Kindle Unlimited don’t read those books. Thus, compensation for the pages read (KENPs) was nowhere near the compensations Amazon gave for borrows in the past.
After I added several AMS ads campaigns in November and pulled out my books from Amazon’s programs, my sales doubled overnight. It didn’t hurt that I could put three more books on ads because Amazon revoked the requirement that all advertised books must be in KDP Select program. Those books were dead, and my ads put new life into them. They were responsible for 30% of my increased December Kindle revenue.
I know you are eager to get to the actual numbers. Here they are:
The Income Report Breakdown
Amazon royalties: €1413.6 ($1498.41)
CreateSpace royalties: €2508.12 ($2658.61)
Coach.me fees: $194.46
Draft2Digital royalties: $23.89
Audiobooks royalties: $11.53
PWIW personal coaching: $375
$36.9, View From the Top Community fee
$29, Aweber fee
$265, Business on Purpose mastermind
$333.3, royalties split with co-author
$1052.87, Amazon ads
$160, RA’s (RA = Real Assistant; my son 😉 ) remuneration
$50.25, my editor’s income share
$75, NoiseTrade promo
$75, new cover for Making Business Connections that Count
$132.1, Bluehost hosting
$7.2, domain for 1$tips
$22.5, a webcam
Net Result: $2501.38