Last week I wrote about payment frequency — how to choose a cadence you can actually keep, and why consistency matters more than speed. This week I want to tackle the thing I've been building toward for a few posts now: advances. Specifically, what happens after you've paid one.
You paid a narrator $2,000 against future royalties. Or a co-author. Or an editor who took a reduced fee in exchange for a percentage of earnings. Whatever the arrangement, you put money on the table before the book earned a dollar, and the deal was that future royalties would pay it back before the royalty holder sees another check. Simple enough to agree to. Simple enough to write into the agreement you built after reading the co-author split post a few weeks ago.
And then the book starts earning.
Money comes in from KDP. A little from IngramSpark. Audio royalties trickle through ACX and Findaway. Maybe Draft2Digital is sending something too. Each distributor reports at a different time, in a different format, sometimes in a different currency. And the question that starts sitting in your mind is: has the advance earned out yet?
You can't answer that by glancing at any single dashboard. The number doesn't live anywhere — not on any distributor's site, not in any report — unless you built a place for it yourself. And if you haven't, you're guessing. Quietly, month after month, you're guessing.
This is the single hardest thing to track in a spreadsheet. Not because you're doing it wrong, but because the problem is genuinely complicated.
Why advances break spreadsheets
Three specific reasons, and they compound on each other.
The earnings come from everywhere. The royalties counting toward earn-out aren't sitting in one column in one report. They're scattered across four or five distributors, each reporting on its own schedule. ACX might have last month's numbers ready. IngramSpark might still be processing. KDP's numbers are there, but they reflect earnings from sixty days ago. To know how much has been earned toward the advance this period, you have to aggregate across all of them — and you have to do it every single period without missing one.
You need a running total, not a snapshot. Most royalty spreadsheets are built to answer "what did we earn this month?" That's a snapshot. Advance tracking needs the opposite: a cumulative number that carries forward from every previous period. It's not enough to know that the book earned $340 in March. You need to know that March's $340, added to everything before it, brings the cumulative total to $1,780 — which means there's still $220 left on a $2,000 advance. That kind of running math is exactly what spreadsheets get wrong when a row gets deleted or a formula doesn't copy down correctly.
The earn-out moment flips everything. While the advance is outstanding, the royalty holder gets nothing from current earnings — those earnings are paying back the advance. The moment the advance earns out, the structure flips entirely: now they get their full percentage, every period, going forward. If you catch the earn-out a month late, you've been holding money you owe them. If you catch it a month early, you've been paying out of your own pocket before the advance was recouped. The transition has to happen in the right month, and it has to be based on real numbers, not a feeling that "we're probably close."
And there's one more wrinkle: if some of those earnings arrived in pounds or euros, which conversion rate counts toward the advance balance? The one the distributor used? The one from the day you reconciled? If you read the currency conversion post a few weeks back, you already know those rates don't agree. For advance tracking, pick one source and stick with it — consistency matters more than precision here.
The manual fix: an advance tracker tab
Here's what works. A dedicated tab in your spreadsheet — separate from your main earnings data, but pulling from it. One tab per advance. If you have three advances outstanding, you have three tabs. It's less work than getting the math wrong.
The structure is one row per period, matching whatever payment cadence you chose. The columns:
Period — the month or quarter this row covers.
Distributor earnings toward advance — one sub-column per distributor, showing this period's earnings that count toward the advance. Important: this is the royalty holder's share of earnings, not the gross. If they're on a 25% royalty and the book earned $400 on ACX this month, the number here is $100. Pull these from your main earnings data — don't re-enter them by hand.
Period total — sum of all distributor columns for this row.
Cumulative total — previous row's cumulative total plus this period's total. This is the number that matters. It's the running answer to "how much of the advance has been earned back."
Remaining balance — original advance amount minus cumulative total. When this hits zero, you've reached earn-out.
Each period, you update one row. Pull the numbers from your main earnings data, let the formulas handle the running total, and check the remaining balance. When it hits zero — that's your earn-out month. From the next period forward, switch to paying their percentage directly.
The key principle: this tab pulls from your existing data. It does not rely on your memory of what you already applied. The moment advance tracking lives in your head instead of in linked cells, it will drift. And advance drift is the kind of error that's almost impossible to find six months later.
The transition month
The month the advance earns out is almost never a clean break, and this is the part most people get wrong.
Say the remaining balance on the advance is $150, and this month's earnings toward it are $340. The first $150 closes out the advance. The remaining $190 is post-earn-out earnings — and the royalty holder is owed their full percentage on that $190, this period, not next period.
If your spreadsheet treats earn-out as a binary — "advance still outstanding" or "advance fully earned" — you'll either overpay (paying their full percentage on the entire $340) or underpay (holding the whole month because the advance wasn't quite earned out at the start of the period). Neither is catastrophic. But getting it right is a two-line formula, and it means nobody has to have an awkward conversation about $190 later.
In the remaining balance column, when the number goes negative, the absolute value of that negative number is what the royalty holder is owed at their percentage rate for that period. Build the formula once, and the transition takes care of itself.
How Royaltally handles this part
I built Royaltally's advance tracking because I was managing three advances across overlapping titles and distributors, and I realized my spreadsheet had been wrong for two months without me noticing. The system applies each period's earnings across all distributors against the outstanding advance balance, handles the transition-month math automatically, and flags the earn-out month so you don't have to watch for it.
Royaltally is in open beta right now. If you're tracking advances manually and the cumulative math is starting to feel fragile, you can try it free with up to 3 titles at royaltally.com.
But the tracker tab above works. If you build it once, link it to real data, and update it every period, you'll know exactly where every advance stands. The spreadsheet version demands diligence. The answer it gives you is the same.
You already know how to do this
Advances feel overwhelming because they sit at the intersection of every other complexity — multiple distributors, different reporting timelines, currency conversion, the structural flip at earn-out. It's all of the hard problems from the last several posts, stacked on top of each other.
But the tracker is just a tab with a few columns and a running total. The hardest part isn't the math. It's building it once and committing to updating it every period. You've already been doing harder things than this.
Next week I'm writing about what happens when a distributor changes their report format — again — and how to keep your whole system from breaking when they do.