(By Chip MacGregor, President, MacGregor Literary, Inc.)
The biggest mistake is that writers jump too soon. I routinely see wannabe authors get a book contract, quit their jobs, and later wonder why their agent can't help them survive financially.
I have three rules for authors who want to go full time:
1. You need to have four to six books earning you royalties;
2. You need to have 18 months to 2 years of book contracts;
3. You need to have a plan in place. That plan includes a budget, a writing calendar, an accountability partner or writing support group, a writing space, adequate equipment, and most likely a therapist, because you're probably delusional to consider the idea anyway.
Let's say you received a nice two-book deal. The publisher pays you $10,000 per book on an advance, so the total deal is for $20,000. You get a third of that on signing ($6,666). You need to be able to live on that while you write your book. If you can write it within three months (relatively fast for most novelists), you've lived on $2,200 per month. Pretty thin stuff. If it takes you six months to do a novel, you have to make do on a thousand bucks a month.
Once the publisher approves your manuscript (which can sometimes take a few months), an editor sends you your completion check for that book, another $6,666, payable thirty days after they request the check. You've now made a whopping $13k, you're months into the process, and you've spent all your good ideas on your first book. So it's on to book two.