First let me apologize for the delay in starting this series. My schedule is a bit wonky these days as we’ve been moving into a new place. Thank you to the writers involved for their patience. Let’s get to it.

The first freelance writer with a story to share this week is Steve Sloane.

Steve’s Story

Steve is a relatively new freelance writer with experience writing for only two companies — one being Demand Media and the other being a website where he contributes film reviews. He has approximately 1800 articles published on Demand’s eHow, mostly in the home repair / DIY niche. The vast majority of those articles paid just $15.

Steve would prefer to write about film, his main passion. But work has dried up with his client in that niche. He has his BA in both Film Theory and Creative Writing. Despite his passion for film, he does understand that it’s an in-demand niche and he’s open to other opportunities. His experience in the home repair and DIY area is based on his own experience building a house and spending years being just generally handy.

He would like to move from $15 articles to a minimum of $50 for a 400-500 word article.

My Advice for Steve

I think $50 per article is a very achievable goal and a good target for newer writers looking to write Web content.

While I’d love to see Steve move immediately into full-time film reviews, I’m intimately familiar with the difficulties in creative markets like this. First, they don’t tend to monetize well through advertising (meaning site owners often won’t spend as much as other types of clients as they see less of a financial return). Another issue, as Steve also pointed out, is that everyone and his brother thinks they can write reviews in these niches (my experience more on the music side, although I’ve seen similar things in film reviews).

With that in mind, I think Steve is a prime candidate for dual specialization. As we’ve talked about numerous times here, being a specialist as a freelance writer does not mean you’re limited to a single kind of writing or a single niche. It means you focus on one or just a few areas, but more importantly you focus on areas where you can offer the most value. I think Steve has an adequate background in both the film and DIY niches to make a go of them.

Normally when I suggest multi-niche specialization, I encourage writers to stick to areas similar enough that they don’t have to target two completely different markets. In this case, I think he can make it work — essentially using one specialty to buy him time to build a reputation in the other.

Basically, I suggest this: Focus on home repair / DIY, but carve out a portion of each work week for film reviews. As Steve grows his client base on the film side, he can transition away from home repair content if he wants to. In the meantime, home repair and DIY material seems like the broader market with more pay potential.

To take it a step further, I’d suggest branching beyond the most basic of Web content (like the shallow content found at eHow). I’d encourage Steve to start his own website in the niche. It could be an ongoing blog, or it could be a specialized niche content site with some static articles that he doesn’t have to update frequently. He could also consider narrowing down the DIY niche a bit. For example, he could focus on apartment dwellers with special needs (such as not being able to put holes in the wall). Or he might combine his love of film with the niche and focus on DIY projects for those interested in setting up their own home theaters.

Once he has a niche site (even a small one), he can use it to build an audience of readers in the niche — not just potential buyers. When readers respect what you have to say in your specialty area, it can make you more attractive to clients who want you to bring your audience with you when you write for them. Better yet, niche sites can be income sources on their own.

Speaking of income sources, I also think e-books are a great thing for Steve to consider. Moving into a new home myself right now, I have tons of questions and ideas around home improvement, decorating, finishing rooms, etc. I own a few huge home repair / DIY books, but they can feel overwhelming. They cover a lot of basics, but sometimes not enough about specific things I’m interested in. Smaller books about these areas could be good, even in e-book form (from flooring to finishing basements). Plus, it can be more profitable to sell let’s say six short e-books at $5-10 each than a longer, more expensive one covering everything.

Those are two options Steve has for not only additional income streams but also portfolio pieces. They can help him build his audience and potentially attract more clients as he becomes more of an authority source.

As for directly targeting clients, I say think outside the box. The obvious thing to do is look for home improvement or DIY sites to pitch. But what about these possibilities:

• Interior design sites and publications
• Women’s sites and publications (saving time and money with DIY projects around the house)
• Blogs for businesses involved in home improvement (from contractors to tool manufacturers)
• Men’s sites and publications (they might have regular columns or sections devoted to the niche)
• Sites or blogs related to home improvement TV series (not quite film, but another way to tie his two interests more closely together)

When it comes to the film side of things, again I suggest starting his own site first. In this case I think a blog or other regularly-updated site makes the most sense as the film scene constantly changes. Because anyone can share their opinions on films on the Web these days, I think it’s extremely important for Steve to come up with a brandable identity for this specialty area. He also might be able to stand out a bit more with a genre or other kind of specialization (such as reviewing horror films or indie films).

Steve really seems to understand that great reviewers don’t just spew their opinions. They really have to know the film world, context, and as he put it “research and work.” Having his own film review site shows prospects exactly what kind of reviews they can expect from Steve, and how his reviews differ from fly-by-night film reviewers just in it for a bit of fun. It gives him a chance to set a professional tone in the way many others have not.

While Steve can start pitching film review sites, local newspapers, online local sites, entertainment sites, or any other kind of prospect that might be looking for reviewers, I think his best chance for immediate income in his target price range is to pitch the DIY articles up front while he builds an audience for his film review site. If he can tie the two areas together (like the DIY home theater specialty I mentioned), all the better. It can save him a lot of time later when he’s ready to focus even more on promoting his film industry writing.

Over the long term as he builds a fan base with his film reviews, Steve can take on fewer home repair and DIY projects in favor of pursuing his passion. In an ideal world, we would do nothing but that. But the reality is that we have to pay the bills. Fortunately Steve doesn’t seem to dislike writing in this potentially more profitable niche.

In Summary

1. Stick to dual-specialization.
2. Focus primarily on your more profitable niche (home repair / DIY in this case).
3. Go with direct pitching for quick results when you’re fairly new.
4. Think outside the box when choosing who to pitch; look beyond the most obvious prospects if you want to decrease competition for gigs.
5. Set up your own niche site and use that content for portfolio pieces rather than relying too heavily on your content mill work to sell you to another level of client.
6. Build your platform and audience in your favored niche while the other brings in income.
7. When building your platform, try to focus on income-generating tactics (like blogs and e-books). The earlier you start these things, the sooner you’ll have extra income coming in to cover you during slow periods.
8. Ideally find ways to tie your two specialties together, even loosely. It can help you decrease the amount of time you need to market your sites and services when you’re reaching similar audiences.

We’ve already looked at why freelance job boards aren’t the best places to find gigs and how you can make it easier for clients to find you through your writer platform. But what can you do in between client projects, as you wait for responses to your pitches or while you’re still growing your platform?

You can build additional non-client income streams (and some of these are actually a part of your writer platform, meaning they can attract clients in addition to direct income). Let’s look at some revenue stream options for writers and then I’ll point you to some further information we’ve covered in the past about two of the most popular options.

Additional Revenue Streams for Freelance Writers

Here are ten potential new revenue streams you can develop as a writer:

1. Books
2. E-books
3. Blogs
4. Niche content / resource websites (free)
5. Paid membership sites
6. E-courses
7. Email newsletters
8. Industry reports (based on original research like surveys)
9. Website flipping (create small well-optimized sites and sell them to webmasters)
10. PLR articles or e-books (content sold at very low prices for re-use or resale, but the same content can be sold to multiple people)

Not all of these income streams will be right for you. For example, if you tend to charge $50 or more per blog post (or want to), selling cheap PLR content can tarnish the image you want to create even if it might be more profitable at times. On the other hand, not all writers want to devote the time that goes into writing, editing and selling a book to bring in additional income.

Now let’s look at two of the most common additional income streams for writers: blogs and e-books. I’m not going to say a lot about them directly in this post as they’ve been discussed extensively in the past. Instead I’m going to link you to further reading, so you can pick and choose the information you really want or need to know.

Blogging

Here are some articles from our archives about getting started as a blogger and using blogs as an additional income stream:

• Make Money Blogging — An Additional Income Stream for Freelance Writers
• Blog Launch Checklist
• Coming Up With Blog Post Ideas
• 101 Niches to Write About
• Score Points for Better Blogging
• Are You a Slave to Your Blog Sponsors?
• How We Increased Blog Traffic by 80% in Less Than a Year (and How You Can Too!)

E-books

Writing and selling e-books can be another way for freelance writers to earn income between gigs. Better yet, these e-books can sell for a long time after the initial launch. If you’re thinking about writing e-books, here are some resources you might be interested in. (Note: Some of these posts are located on my indie publishing blog rather than All Freelance Writing.)

• How to Write an E-book in Just 14 Days (a free e-book)
• How Writing E-books Can Save You From a Low Pay Rut
• Planning and Outlining an E-book
• E-books and Reports — An Additional Income Stream for Freelance Writers
• Using Testimonials to Sell an E-book
• 5 Factors to Consider in Pricing Your E-book
• Zoe Winters on E-book Pricing: Does Low-Balling Attract the Wrong Kind of Reader?
• Why Most of My E-books Won’t be Sold on Amazon
• How to Market an E-book

No freelance writer must create additional income streams. You can spend that extra time on more pitches. This is just one way to diversify your writing business, and products or services that bring in regular income can alleviate some concerns when freelance work dries up.

Choose income streams based on your own target market. PLR articles have no place in some niches. Print books might not make sense for fast-moving industries where books would quickly be outdated. Not all markets will happily pay for access to a new membership site.

Identify your market and figure out how to solve problems for them — in the end, that’s how you make better money, whether through freelance contracts or your own projects.

If you’ve enjoyed this series, come back next week when I’ll share tips and advice with five freelancers about their situations and goals for moving past Demand Media. You might find some of those suggestions useful in improving your own freelance writing career.

In the meantime, if you’d like to read more, you can check out the following articles from our archives:

In my previous post here on AFW, I covered 6 alternative jobs that might interest freelance writers. There were some questions about starting an article idea/blog post idea generation business, so here are some tips and steps for getting started.

What is a Micro-Service?

Before I tell you how to start, let’s talk about micro-services. Idea generation is what I call a micro-service, i.e., a service that is cheap, quick, and easy to do. These are the kinds of services you’ll see on places like fiverr and gigbucks. However, you don’t have to limit yourself to those venues when creating a micro-service. I consider banner design and per-article editing (like 250 words) a micro-service. Basically, this is a service that everyone needs and that’s hard to screw up.

Price per Idea & Set Minimums

Generating article ideas (e.g. How to Write a Great Article) is a micro-service. People will be coming to you to get multiple unique and well thought-out ideas at once. Since you aren’t actually writing the article, pricing on the same scheme you would an article doesn’t really make sense.

Namely, nobody’s really going to pay $0.50/word for 6 words. Your customers are probably going to be hiring a writer (maybe you!) to write the ideas into full articles, so try to keep base prices (just the price of a title) as reasonable as possible. My suggested price is $0.99/article. If you’re creative, that’s pretty much a dollar a minute.

The key to running a successful micro-service like blog post idea generation is setting a minimum amount. You don’t want to kill yourself promoting one-off orders. A good place to start is 25 ideas.

Take Money Upfront

The problem with lower-end services is that people will walk off without paying if you aren’t careful. There’s no real way to trademark something like a headline, so collect payment upfront before you start thinking up ideas.

Automate as Much as Possible

Micro-services can become complicated very quickly if you don’t stay on top of things. My suggestion is to automate as much as possible. Use a plugin like Gravity Forms to have clients submit all of their information and pay upfront. That way all you need to do is confirm payment and deliver the finished product via email.

Speaking of the finished product, use templates to make the process faster. Have a document saved with 25 bullet points already setup or create an excel file with the columns pre-defined. The more of the administrative stuff you can get out of the way, the better.

Set Work Hours

The temptation to do an order when it comes in will lead you down the path of burnout. Set aside some time each day for completing ideas, then sit down and plug n’ chug through as many orders as you can before your time runs out. The great thing about these services is that it’s nearly impossible to deliver a low quality order, so speed is a key factor.

Are you interested in starting an idea generation business? What other questions do you have about micro-services?

About Corey Freeman

Corey Freeman is a professional SEO blogger. She also runs Writing Whale, a site dedicated to helping aspiring freelance writers get started.

Writing for ad revenue is usually a bad idea for writers. Some of the big networks have been doing it for years, and the problems have been clear for a long time now. It’s easy to justify it though. I’ve been there myself. I’ve crunched numbers in any way imaginable to convince myself that it was better to get paid over time. But over time, reality sets in. Even if it might have been a good idea several years ago, it isn’t now.

Why Writing for Revenue Share is a Bad Deal for Professional Writers

1. Visitor claims are intentionally exaggerated. A site, mill, or network may indeed have the millions of visitors they claim when they use that point to suck in writers. Great for them. What they neglect to tell you is that the vast majority of those millions will never visit your specific articles. Many go to the homepage. Others use the site for other reasons. They visit articles written by other writers. Those visitors don’t earn you any ad revenue, which is usually based directly on ads only found on your articles. You can often monetize your own site much better within a few months.
2. You don’t have any control over the ad placement to improve conversions. Again, you’re better with your own site where you can diversify income streams and optimize your site to improve conversions if you want to make money through ad revenue. The best ad placements can vary for different audiences in different niches. Huge sites with a standard article template can’t account for that the same way you can independently.
3. Every article is a gamble. If they’re so confident in their ad revenue potential, they can keep it and pay you a fair market rate out of pocket, expecting to profit through the ad revenue over time.
4. Relying on 3rd party ad revenue means you also rely on 3rd party marketing. Your content is useless without visitors, and if the site isn’t going to heavily promote YOUR content (as opposed to generically promoting their site) to get those visitors and drive ad revenue, that falls on you too. Yep. You’re expected to market their site too without any direct pay. Tip: it isn’t uncommon for people offering that service to make another $50-150 or so per hour.
5. Long-term promises don’t pan out. Some of these sites try to suck writers in by saying they’ll earn ad revenue indefinitely or that it will continue to grow over time. That’s utter BS. It happens like that early on. But eventually the ad revenue drops unless you continually create new (relatively unpaid) content. Old articles drop in search rankings and lose traffic. They end up in an oversaturated pool of content on the site as opposed to when the program just began. And many articles eventually become outdated. It’s rare for anything to earn forever, nonetheless keep increasing in value.
6. The online ad environment isn’t what it used to be. –  If you’ve been involved with online advertising for years, you probably know it can be tougher now to survive on a single ad revenue stream than in the past. That’s especially true if a site relies on something like Adsense alone, when it’s common knowledge that model has been suffering due to social media and changes in online ad models available to advertisers. Keep your content on your own site and invest in its growth for a few months instead and you can diversify your income streams much more effectively based on what works in your niche (another tip: not all niches monetize well through contextual advertising).
7. High earner examples are also exaggerated. — Another way these sites draw in writers is by sharing case studies for writers making out well with their system. But what they don’t tell you is equally important. Take a look at their about page, press room, or anywhere else they offer info about their site. See how many writers they claim to have. Now how many high earner case studies are there? Back in January one of these revenue share sites inadvertently made their list of top earners publicly viewable. While they didn’t share names with the revenue info, here’s what you could find out if you took a look: out of the 20,000 “professional” writers they claim to have working for them (another page says 8000 which more likely represents the US / Canada site), only nine were earning over $1000 per month. The highest earned under $2400. Keep in mind that contractor pay is a very different animal than employee pay, and you can see how little this actually works out to for those US / Canadian writers. A beginning writer with an effective marketing plan can earn more with private clients. While things will fluctuate over time, this is hardly a good sign, or the glowing image they try to present to attract new writers.
8. There’s a high opportunity cost. — Not only did few writers reach even a low full-time income level, but to do so generally means writing hundreds of articles first with little up-front return. Any way you cut it, you’re better off getting paid a reasonable rate up front and then investing that money for better returns. You have the money when you need it. You can invest it back in your business for further growth and greater income potential. And in a stable investment you can see consistent gains without the risk of that suddenly stopping as Google algorithms change.
9. There is no sure future. — Along those lines, you take another risk when you write for these sites. They’re often highly focused on writing for search engines or ad revenue over readers (and any site letting writers write about anything based on how much ad revenue it brings rather than topical knowledge fits the bill). This is why these kinds of sites run the risk of being targeted by search engines like Google which are looking for ways to weed out shallow content and spammy sites. I received an email just a week or two ago from someone about one of the bigger revenue share sites, telling me how they were completely slammed by the Google Panda update (which was its intention). In other words, you can’t count on your traffic or income sticking around when you don’t control the sites your content is shown on. If it’s your own site you can fix the problems quickly and request reconsideration. You don’t have that ability with a third party site.

Here’s what it comes down to: bad deal for the writer, great deal for the cheapskate site owners. If you’re a hobby writer hoping to pick up a few bucks and you have no interest in launching your own site, by all means go for it. The point isn’t that they have absolutely no place, but rather that these sites aren’t right for most professional writers.

If the exception to the rule is only earning a low full-time freelance income, that should be a hint that you can do better. Even if you think you can match their success, look at the numbers. We’re talking about chances like being one out of 1000-2000 writers (depending on which of the site’s writer stats you choose to look at — either way, not in your favor).

Instead, use your content on your own site. Chances are good you won’t get rich that way either. But you have full control. And your own site goes much further in promoting your services to private clients — where the real money will come from for most professional freelance writers.

1. The client hired the freelance writer for a previous project at the writer’s professional rates.
2. The client had need for a professional writer again.
3. The writer sent a proposal (which the client asked for).
4. The client contacted the writer saying they could really use this person’s talents, but the organization hasn’t been funded. Oh, and they said they wanted the writer to do the work for free. As clients wanting freebies often do, the non-buyer implied the writer should look at the long-term opportunity (because you know, non-paying clients always turn into super lucrative gigs down the road).

In this case the writer did the same thing I would have done. The gig was turned down and the client was told they could get in touch when they were adequately funded to cover the professional services.

Should You Ever Take Non-Paying Nonprofit Gigs?

While the writer made the best choice for themselves in this case, that doesn’t mean you should always turn down volunteer work with nonprofits — as long as doing so doesn’t impact your business negatively. It can be a far better way to build a freelance writing portfolio than writing content for absurdly low rates for otherwise paying markets (because you target unprofessional markets with far worse reputations than a respectable nonprofit organization has).

If you want to take on the occasional volunteer gig as a freelance writer, here are a few things to keep in mind:

1. Choose organizations and causes you’re passionate about.
2. Do not let volunteer work take any of your billable hours. Do it outside of working hours altogether or at least work it into your time allocated to marketing and PR — it’s good PR for your business after all.
3. Solicit volunteer opportunities on your own rather than simply saying “yes” to any and all nonprofits that come along begging for freebies.

That said, nonprofit agencies do pay professional writers and other contractors. They do have budgets. I used to work in the nonprofit sector and have dealt with organizations big and small. It’s amazing how much some of their management is paid, and it’s even more amazing how much money can actually be wasted. The fact that an organization isn’t trying to earn a profit does not mean the organization has no operating costs. Those operating costs include paying for professional services from regular employees and specialized contractors alike.

Nonprofit Warning Signs

Keeping that in mind, here are some warning signs to look out for (and hints that you might want to pass on a volunteer gig for a nonprofit agency):

1. They initially pay you and then try to talk you down to working for free.
2. They request a proposal knowing damn well that will include service rates, and then try to say there’s no budget. That does nothing but waste your time and demonstrate their professional disrespect for you.
3. They try to convince you that you should care about their cause as much as they do (and they can be very convincing when they want something — I know that because I was very good at it myself in my nonprofit days, and it was one reason I left).
4. They promise you’ll see benefits later if you just invest the time now (what they really mean is you’ll get a warm and fuzzy feeling thinking you’re doing something good — not that they’ll suddenly start paying you once you show them they can get you to work for free).
5. The organization is brand new or one you’ve never heard of. Anyone can start a nonprofit organization and ask for handouts to support a cause they care about. That doesn’t mean you have to support every cause out there.
6. They say they aren’t funded. If they can’t get initial funding, there’s no guarantee they’ll be funded later to pay for your services down the road.
7. They tell you that your usual rates are tax deductible if you do the work for free. They’re not. (That’s true for U.S. service providers; check your own local rules regarding tax deductible services if you’re located elsewhere.)
8. They try to guilt trip you in any way, shape, or form. That’s emotional manipulation and shouldn’t be tolerated from any client, nonprofit or otherwise.

Nonprofit markets can be very lucrative for freelancers who specialize in them. Organizations need compelling copy to solicit donations. Many need bloggers. Many need regular newsletter content. They need brochures. They need scripts for radio and television public service announcements. Some need writers to handle internal communication.

Types of nonprofit gigs are as numerous as traditional corporate freelance writing jobs. And there are plenty of organizations that are adequately funded and interested in hiring professionals over less experienced (but easier-to-get) volunteers because they know the return they’ll see can far outweigh the costs.

Don’t believe for one second that just because someone works for a nonprofit organization it means you shouldn’t get paid. There is nothing wrong with doing some volunteer work out of the goodness of your heart. But don’t let that ambition to do good turn you into a sucker.

Know the organizations you get involved with and don’t commit to more than you can handle on a volunteer basis. Also don’t assume that one volunteer gig should lead to ongoing freebies. You might very well take on a small project as a volunteer and convince the organization to hire you for more in-depth writing work later.

What are your thoughts on nonprofits? Have you ever experienced something like the writer mentioned above? Have you had a nonprofit try to guilt trip you into providing your services for free? How did you deal with it? How do you incorporate the occasional volunteer gig into your schedule without negatively impacting your business? Share your thoughts, tips, and stories in the comments below.

They’re not. You are. Remember, no one owes you a living as a freelance writer. It’s up to you to go out there and make one for yourself. Let’s talk about a few things you should stop doing right now if you want to get past your own mental blocks, and what you can do to build that living you really want as a freelancer.

Stop These Habits to Grow Your Business

1. Stop complaining about writers who are willing to work for less than you are.

They’re not really your competition. And either they’ll do fine in a lower level market or they’ll fail miserably, learn the hard way, and start over with more realistic rates and market targeting. These writers don’t affect you in any way when you act like a professional in promoting your own business.

If you don’t want to compete in their cut-throat race to the bottom markets, stay out of them. It’s one thing to encourage people to do better for themselves when they want to. It’s something else entirely to blame them for your own lack of success.

2. Stop telling other writers they should all charge more to raise the bar for your work.

That’s not their responsibility. Your rates do not depend on what the masses in other markets do. Or if they do, you’ve messed up somewhere along the way. Fix your business on your end. Don’t expect others to do it for you.

The only rates you should be concerned with are rates of directly comparable writers. Just because you both blog, it doesn’t mean you’re in competition. Think about market segmentation and figure out where you fit in, or where you want to fit in.

Attempting to standardize rates does us all a disservice because it implies rewarding those less qualified just because you think your own work is valuable. If it really is, it’s your job to convey that value to individual clients and prospects — not to an over-generalized group of colleagues.

3. Stop relying so heavily on advertised gigs.

I feel like I’ve said this until I’m blue in the face, but let’s have at it again. Shall we? The best freelance writing gigs are not usually advertised publicly. Still writers keep asking the same old question — “where” are the high paying freelance writing jobs? If you’re doing your job on the marketing front, those jobs are where you are.

Stop expecting job boards, freelance marketplaces, and most importantly buyers to hand-feed you great gigs. If you want the high paying freelance writing jobs, stop wasting so much time looking for the “where.” There is no place where all the good buyers congregate. You’ll get lucky and find some in these places, but they don’t represent the bulk of great gigs available.

If you really want to improve your living as a freelance writer, make sure buyers can find you. Get a professional website up, and make sure it’s well-optimized so it ranks well in search engines. Have an active presence in communities where members of your target  spend their time. Get to know your colleagues who might refer gigs they can’t (or don’t want to) take on. Launch a blog that would interest your target market — one that demonstrates authority status in the subject matter. There are a lot of things you can do to build visibility and your writer platform.

Are you guilty of blaming others for your own lack of success in freelancing? Do you keep doing the same old things (like browsing job boards looking for those golden gigs), always expecting the results to change? Then it’s time to step back and reevaluate what you’re doing. It’s time to take responsibility for the successes (and shortcomings) that result from your own business and marketing strategies. And it’s time to set those defeatist ideas aside and get back to growing your freelance writing business. No one owes you a living but you. Now what are you going to do about it?

This is an article about how writing for sites that offer residual income is an option for people who want to retire. In other words, writing now will continue to pay you indefinitely even when you want to retire. No retirement account? That’s okay. You’ll still have income rolling in. Better yet, you can keep working through your so-called retirement by writing more articles. I’m sorry, but there’s a big difference between true retirement and simply retiring from one industry to jump into a different job because you can’t actually afford to retire.

I need to point out a few fallacies and misconceptions on this one.

Stability

Retirement income must be relatively stable. You set aside what you need, and you take out $x per year to cover your expenses after retirement. Ideally you do not rely on fluctuating income streams that have no stability. Remember, most of these residual income sites haven’t even been around long enough to show they can support someone through retirement.

Even those that have been around for a decade or more have changed hands, changed revenue share / pay models, and other policies every few years. Others have disappeared completely. And if you look at the contracts of some, it’s clear that they can decide to pull your articles when they want to and stop further compensation (although that may depend on the site).

That is anything but stable. And it is far from a responsible retirement plan.

Pay Expectations

The article’s author gives the example of earning more than $5000 per month residually. The idea is that every article will earn you at least $1.00 per month. That, I’m afraid, is a false assumption. Many articles on residual pay sites don’t earn anywhere near that much (although yes, some can earn much more).

The idea that people are going to churn out 5000 articles at all on the residual front is likely unrealistic. While I have no doubt there are a handful who have or who will, that just doesn’t represent the majority. Let’s look at Suite101 — one of the oldest content mill variety of sites. Several weeks ago they made their stats and top earners info public (although it may not have been intentional as it was behind a login more recently). While I won’t share December stats numbers, I will share a few from the previous month — the numbers that were publicly viewable. Just for the record I came across the data due to a Google Alert for my name as a few old articles are still published there and I appeared on one of the lists.

Out of the top 20 pageview earners in November 2010, only one wrote more than 1000 articles. Out of the top 100 pageview earners, only four writers produced over 1000 articles. I know for a fact that there are Associated Content writers who have produced more content than this, so I don’t claim Suite101 represents all residual income sites. Yet it was AC writers commenting a while back about their $500 or so per month while neglecting to mention that they had to write more than 1400 articles to get to that point (not even $.40 per article each month). Writing more content doesn’t necessarily equate to higher earnings.

Now let’s look at the income side of writing for Suite101. The top earner in November earned a little over $2300. That’s not bad, especially comparing it to the $1.00 per article per month goal the Helium author mentions. But these writers are the exception; not the rule. Keep this in mind. Suite101 claims to have content published from over 20,000 content producers. And in November’s earnings report where they shared the top ten anonymously, only eight people broke the $1000 mark. That means the other 19,992 writers with content up on Suite101 earned less than $1000 during the month. Those aren’t promising numbers, especially if you think you can rely on these residual pay sites to cover you in retirement. And despite my personal feelings against the company I do have to admit that they’re one of the more “stable” options around. Of course many of those 20,000 writers no longer produce new content for the company. But if you really want to retire, you shouldn’t have to either. And keep in mind, there’s a reason people move on to other things.

So is it realistic to say that people wanting to retire (and we’re not only talking about actual writers here) can just whip out 5000 articles, count on at least $1.00 per article each month, and support themselves for the remainder of their lives? I don’t think the article comes anywhere close to making a realistic case for that. And any way you cut it, the majority of people writing for these sites don’t fall into that boat. If “professional” writers aren’t doing that, why should it be assumed that any Tom, Dick, and Harry can leave their old line of work and make it happen even later in life (meaning less time before retirement), not accounting for how long it really takes to finally reach those income levels?

Better Options for Residual Earnings

One of the biggest problems with relying on third party residual earnings sites is that you’re also forced to rely on that third party to optimize ads and page formats or content styles to maximize earnings. You might assume they’re the best for the job. Not so. What works with one audience often doesn’t translate to others. And these sites are rarely niche-specific. They take a generalist approach of trying to be everything to everyone, and therefore don’t tailor site formatting and ad placement to each topic area’s specific audience.

This is one of the reasons I generally recommend keeping residual earnings to your own projects. You have the control. If something isn’t working out, you can change things. You can optimize ad placement. You can increase your ad prices as your traffic increases with private sales. You can tailor things more effectively to the niche audience you write for. You can create and sell ancillary products like e-books and reports. And if you want control over your residual income you need control over the content and monetization plan.

That’s not to say this is for everyone either. I’ve shared a story here before about taking a small business blog from nothing to around $2000 in monthly earnings in just three months (not any longer as that blog has been somewhat neglected for other projects). And while it’s a good example of what you can do with your own site with some initial hard work, it’s also the exception and not the rule. I know bloggers who have been at it for years without making more than a few hundred dollars. Just because residual income sounds nice on the surface, it doesn’t mean it’s right for you and it doesn’t mean you’re cut out for that particular kind of work. And it is still work.

Want to Retire? Get Up Front Payments!

There was one section in the Helium article that really bothered me.

In the mean time, while you are writing for those five years you will still be earning money.  You could just wildly spend that money, but it makes more sense to save and invest that money.  A high yield savings account is a safe place to earn interest on the money you have made, so there is very little risk in losing that money.  Imagine the amount of money you can acquire through residual income and interest over those five years.  Talk about a nice retirement!

Here’s a reality check. Spending the money you make pre-retirement while writing articles is not a case of spending it “wildly.” It’s called paying your living expenses, and compensating yourself for the time spent working. Even if you have another full-time job and you can afford to save all the money you make writing, this is not the way to go.

If you want to put the money into savings and investments, that’s fabulous. But then you’re much better off getting paid reasonable rates up front and investing that money sooner. Otherwise guess who’s earning on that money even though you’ve already completed the work. The residual income site. That interest should be yours.

For example, let’s take the $1.00 per month per article rate the Helium article mentions. Now let’s take a very modest professional blogging / Web content writing rate of $50 per post, paid in full up front (for the record most pros I know are charging $100+ for very simple Web content and blog posts and much more for Web-based feature articles — the gigs are out there if you stop looking for the easy way out). Let’s look at that over the course of five years.

Assume the residual income case where you need to write 5000 articles in those five years. You would have to write around four articles every week day for five years (no personal days other than weekends, no sick days, no vacation time, etc.). At that point you would finally be earning $5000 per month.

Or you could try this. Charge for your articles up front. If you were still to write the same amount of content, but charge the modest professional level rate of $50 per post, you would earn $49,800 starting your first year. With the residual income model you only earn $6474 that first year. Income from residuals doesn’t exceed the yearly income from up front pay until Year 5 (and then just barely, at $54,280 — based on 83 articles every month).

At the end of five years, the residual model leaves you with $151,890 in savings for retirement. That’s not bad, but it’s also not going to cover you through retirement. You have to continue working anyway. It also doesn’t come close to the five year total of $249,000 from those relatively low up front payments. If you charged a more professional rate of $100 per simple Web article, you could earn nearly a quarter of a million dollars while writing only half the content the residual income writer has to churn out (again, that’s with no vacation time, personal days, or other breaks beyond weekends). My base rate is $200 per post. That means I could write just about 20 articles each month and earn the same $249,000 in five years. Or by sticking to the 83 article direct comparison, that comes to $199,200 every year, or $996,000 over five years. At least the hard work would leave you with enough that you could take real time off during retirement.

I’m not saying you should strive to find clients for 80+ articles every month in up front payments. The point is that you can earn much more from the start by getting paid now rather than later for your work. And you can do that with less work. That’s more money to go into savings and investments now and for you instead of for some content mill. Put it in high yield savings. Invest it in the market. Invest in other residual income streams of your own (like self-publishing e-books and books or investing in site launches that will bring in ad revenue for years to come).

What Would Make Residual Sites Really Work?

I completely understand that residual income sites look attractive on the surface. And I can practically hear some of you thinking “yeah, but after those five years, I’ll be earning more than the writers being paid up front and I can stop working and keep collecting monthly payments!”

Well, maybe. But that assumes a lot. To put it simply, it would take a miracle. All of the following would have to be true:

1. You would have to be able to consistently produce 83 articles per month every single month for five years minimum.
2. Every article you write would have to successfully earn a minimum of $1.00 per article per month, and they would have to begin doing so immediately upon publication to make the numbers in this article work. That is unlikely, meaning you would fall short of the income estimates here and have to wait more than five years to be at the $5000+ per month income level.
3. The content mills would all have to remain relatively stable on the payout front not only for the five years you plan to actively write for them but for the entire length of your retirement. If you live 20 years into retirement, that means a total of 25 years. No content mill / residual earnings site has been in existence that long, nonetheless paying writers in a reliable manner.
4. Search algorithms would never change during those 25 years or so in a way that might negatively impact the rankings and therefore traffic of these sites. That is extremely unlikely considering Google (a primary traffic source in many cases) openly admits to wanting “content farms” to decrease in rankings. I would be extremely surprised if we don’t see significant ranking losses for these residual payment sites among other types of mills and content farms within the next two years.
5. Every article you write would have to maintain its traffic levels (and therefore ad revenues) indefinitely. That means each would have to remain highly relevant (not timely pieces, which do a good job of bringing in quick traffic and income but a lousy job of maintaining a long shelf life for retirement planning). It also means no better content would be produced on the topic which might divert traffic and readers away from the more outdated material over the years.

The chance of all of those things happening in a way that these sites could support you through retirement is slim at best. Things on the Web have a habit of changing rapidly. Easy money doesn’t last forever. Small MFA site owners and sploggers were cut off. Directory owners took a big hit years back. The big money Myspace marketers died off with the site traffic. Residual income content mills won’t be around forever, and it’s nothing but naive to put your faith in the contrary.

Even diversifying by using several of these sites isn’t likely to help you. Why? Because the potential site killers for one can do just as much damage to all. In the end, every one of them is somewhat at the mercy of Google and the other search engines. And as social media referrals replace search, they’re in even bigger trouble. That’s when quality content matters even more because every link given screams “personal recommendation.” And let’s face it. If you’re already working full-time and trying to use residual sites to stockpile money for retirement, quality is going to take at least a small hit as you try to cram in 83 articles consistently every month on top of your other job and life obligations.

While it’s a nice thought on the surface, when it comes to counting on third party residual income sites to support you during retirement the odds just aren’t in your favor.

Need some ideas on how you can get started? Here are five examples of ways you can use your freelance writing skills and knowledge in your specialty area to sell information products and make more money.

E-books

E-books are a popular option these days for writers wanting to sell products thanks in part to e-reading devices. But they’ve been a big deal in entrepreneurial circles for a long time. They’re a proven income stream, and they can bring in recurring income as long as the topic area is still valid (meaning evergreen topics are a good choice for e-books). Write an e-book of your own and you can sell it. Target members of your existing target market if you want to capitalize on your current platform and network to boost sales.

Books

You can also go a more traditional route and write print books. You can seek traditional publishers or you might opt for the indie publishing route. Again, focus either on your own target market or on their target market (for example, if you write for magazines that cater to parents, you could write a book directly to the parent audience).

DIY Kits

As much as you like having people pay you to write for them, you could make a good amount of money by teaching the true DIY-ers of the group to do things for themselves. There are several ways to do this, including webinars or e-courses. But if you want a simpler recurring revenue stream, why not create information kits? For example, if you write sales letters frequently and you want to tap those who might not be willing to pay your service rates you could put together a kit with tutorials and templates. You create it once and sell it over and over again. You don’t have to give away all your secrets. But you get recurring income and get to reach buyers who otherwise wouldn’t have given you a dime.

Subscription Websites

Maybe you’d like to spend more time writing the content that you want to write instead of what clients want. Wouldn’t it be wonderful if you could essentially sell that content over and over instead of to just one client (or a handful in the case of reprints)? You can do something similar with a subscription website or a subscription-only section of your blog. Just create premium content once and sell access to it repeatedly to each subscriber to your site. You won’t get away with charging for basics everyone else offers for free though. So find ways to make a subscription worthwhile.

Reports

Maybe you’re used to writing white papers and reports for clients. Why not do your own original research and release the report for a fee? If you specialize in an in-demand subject area where people are interested in new research, this could be a great information product for you. For example, you might run a major survey each year and publish the results (note that a simple online poll isn’t going to cut it if you want to charge for the resulting report).

How would you turn your writing services into products to expand your income potential beyond your typical billable hours? Leave your experiences or ideas in the comments below.

Why Per Word Rates Don’t Matter

Per word rates aren’t a good tool for comparing writers or gigs for one basic reason. All gigs are not created equal. This is what baffles me when I see magazine writers who are used to $1.00 per word or more scoff at per word rates like $.25 or $.50 for completely different types of gigs. When people do that it’s sometimes out of sheer ignorance of the differences of the job. Let’s look at an example.

Let’s take a $1.00 per word magazine feature, assuming 800 words. Your total pay would come to $800 for the project. But that project might take you 12 hours over the course of two weeks to write when you factor in interviews and other research and changes after editorial review. You earned around $67 per hour for that project.

Now let’s look at an online writing gig. I’ll even give you a specific example of a common project of my own. I have a specific client who generally pays $130 per blog post based on old bulk rates negotiated. When they order an article of 800 words, they’re charged double that rate — $260. These blog posts of that length take about an hour and a half to two hours to write and almost never require edits. They’re usually beginner-level material or opinion pieces suited to blogs, and they’re generally also in my direct specialty areas, making them relatively quick projects. That comes to a supposedly abysmal $0.325 per word. Yikes.

But hold on. What does that come to as an hourly rate? $130 – $173 per hour — averaging nicely around my $150 per hour target billing rate. That’s significantly more pay per hour than the magazine writing gig at a higher per word rate. And to get that bulk rate the client orders ten posts per month (most often around 400 words, with the same hourly rate range). That brings the total earned to $1300 per month and 10-15 hours worth of work. If they order fewer than ten articles they pay more per post, bringing the hourly rate up even higher.

The real perk is that ten articles over the course of the month is far from pushing burn out level. We’re not talking about being forced to cram several articles in every hour of every day just to earn a mediocre rate. To make it even better, it’s often easier to land these gigs than magazine writing gigs, especially if you’re a new writer. The market is ever-growing.

Now that’s not to say that there’s anything wrong with magazine writing or the freelance writers who prefer the gigs. I’m just saying that before you automatically assume a gig isn’t as good as yours, look at the numbers that actually matter. You might very well be earning less than you think. Per word rates are inherently misleading because they don’t account for the actual work involved. Hourly rates do. That why I always suggest starting with hourly rates when setting your freelance writing rates and then convert it into your target per word rate.

Of course there are limits to that. There’s a difference between a gig with reasonable expectations where you can earn a significant hourly rate and one with too little pay for what’s expected of you. These are things like mill work or the cheap webmasters who want to pay $10 per article with a long list of requirements. These aren’t sustainable long-term career options for freelancers who need to make a living out of their writing. And they require relying heavily on single clients or very few, putting you too much at the mercy of third parties. You can only go for so long before the constant breakneck pace catches up to you. You can only go so long before you get discouraged by a lack of actual growth in your freelance writing business. So yes, there are gigs that do pay far too low in per word rates. But that’s because the same gigs pay too low in hourly rates, either forcing people to sacrifice marketing time to artificially inflate their billable hours or eventually burn out because there’s no time left to pursue better freelance writing jobs.

So before you automatically assume a gig is a bad one because of a per word rate, figure out what you’re really earning with those high per word rate gigs you take on. And then compare it to the hourly expectations of the other gig. Sometimes you’ll be right and the lower per word rates will be a terrible deal for you as a professional writer. But in other cases you might just be surprised at how much more you could earn during your billable hours. Maybe it’s time to look at things from a different angle.

I found this site that I enjoyed visiting immensely was hiring through Craigslist, and they posted a pretty darn good rate. I thought that was brilliant, so I applied for and got the job because I have a kickass portfolio and darn it I wanted the job. They could tell because I told them in an email. That, and I explained carefully in detail how I’d be willing to debase myself in any number of ways to get the job. I do not recommend that as part of the job process to be frank with you.

Anyway, I posted my first article and it was popular beyond my wildest dreams. I ended up getting almost 130 comments on just one post, and that felt pretty incredible. I’d never posted a blog post that was that controversial, well-read, or discussed before. Now and since, there is not a single post that’s appeared on that site’s blog that has been nearly as popular, so I was feeling like a stud. I started to wear my sunglasses at night, changed my attitude completely, and alienated my friends until a humbling event forced me to examine my life–at least that would have happened if I was in an ’80s movie. Instead I just got my paycheck and gratefully moved on.

I wrote a second article that was along the same lines. Essentially, I was to become their columnist, and I was excited. They told me that it would be on a monthly basis (what?) and that I would have to scale back from my previous length because they couldn’t pay me as much as they did for the first article (what??). So all of a sudden, that sweet rate was half of what I thought it would be. Still, monthly isn’t bad so I put it together and then I waited.

And waited.

And waited.

And you get the point. It turns out that they have some funk-ass publication schedule that apparently is none of their writers’ business, and that my article wasn’t slated to come out for another month beyond what they’d initially projected. Oh, and by the way, they don’t pay until publication, which I told them was a steaming pile of rabbit turds. They shot back that I should have read the writers’ agreement to which I cleverly replied that they never sent me and then they said that it didn’t matter so I didn’t feel so clever anymore.

So rather than get pissed, I went to their next-largest competitor, gave them a pitch they couldn’t refuse, and now I write for them. I just landed the gig last week.

The point of this story is that revenge is a dish best served garnished with fat wads of cash. True, my rate isn’t the same as what it was with them, but I’m posting so much more frequently that I’m getting the same as what I’d have supposedly gotten with them anyway. In this time of holiday cheer, remember: don’t forget to screw the jerks if they hold out on you. It’s what Santa would say.