I'd like to answer some of MontyApollo's points from a couple of messages above:
"Once you finished your first novel and run the gauntlet of query letters, finding agents, sitting in slush piles,
negotiating contracts, waiting for your print run, etc…, if you are lucky, you are looking at several years before
your novel is in print."
My experience, and that of most pros I've spoken to, is that it usually comes out in something less than a year.
Which gives the publisher/editor/art director/publcity department time to do their jobs.
"Typical advances for your first three novels is about $5000 each."
Advances vary. I won't hold Terry Goodkind's $250,000 for his first novel up as an example, because it's a rarity. But we have a science fiction writer in Cincinnati (not me) who got $20,000 for a first novel. It really isn't un-heard of.
"Often only one book a year will be published."
Now here I do have facts and figures. Mercedes Lackey, beginning in 1985, in a career spanning less than 30 years to date, has sold 123 novels and 11 collections. Barry Malzberg, from his first novel in 1967 to his last in 1985, a span of 18 years, sold 84 novels and 10 collections. Eric Flint sold his first book in 1997, and in a 16-year-career has sold more than 50 novels and collections. Terry Pratchett from 1983 to date, a 30-year-career marred by recent illness, has sold 71 novels. I myself have sold 71 science fiction and mystery novels, 25 collections, and 10 non-fiction books...and I sold more than double than amount in another field under pseudonyms from 1964 to 1975. I assure you we are far from the only ones to sell more than a book a year.
"Assuming you don't get dropped at some point, the median advance the rises to about $12,500 and
tends to stay in that neighborhood unless you make it big. (http://www.tobiasbuckell.com/2005/02/07
Back in 1992, Hugo-winning Lan's Lantern did a survey and found that something like 60 sf authors and a dozen estates were making $100,000 a year or more. If you average in all the non-sellers and poor-sellers and one-and-two-time sellers, yeah, it goes down...but consider the definition of "median": half the people make more than $12,500 per novel.
"So 10 years after completing your first novel, you would have 5-7 books under your belt (most "out of print")
and be making about $12,500 per book. If your publisher only wants to publish one book per year, then you're
making $12,500 per year."
If, 10 years after completing your first novel, you have 5-7 books under your belt, you're either writing 300,000-word
books or you're not writing full time (or you are a terrible manager of your time). If you are making $12,500 a book after 10 years, if means either you didn't sell very well, or you didn't manage your career very well. (And if he's only buying one book a year from you and you want to sell more, well, there are a lot of publishers out there. Who says you have to be confined to just one publisher? Only your option clause holds you there -- and if he doesn't exercise it, you're free to sell to another publisher as well. And if he -does- exercise it, then he'll have to buy as often as you offer.)
And you know what? At $12,500 per book, you can -still- make, not a good living, but a decent one. How? Easy. You sell 2 books a year. There's $25,000. By now foreign publishers know you're not a one-trick-pony, that you've stuck around, so they're willing to invest in you (remember: $12,500 isn't much after 10 years, but it means you sell well enough that your publisher keeps buying you and hasn't dropped you or cut you back to $5,000 or thereabouts). So you sell for lower-midlist prices to Japan (2 books at $4,000 apiece), England (2 at $5,000 apiece), Italy (2 at $1,500 apiece), Spain (2 at $1,500 apiece), and one each to the Czech Republic ($1,000), France ($2,500), Russia ($1,000) and China ($1,000). Remember, these are midlist and lower-end-of-midlist prices...and at the end of the year, never getting a US advance of over $12,500, never selling a Hollywood option or a game option, never putting your reverted backlist up as epubs, your annual gross for a not-very-triumphant career is $54,500...with no royalties, no short story sales, no collections, editing no anthologies.