Becoming a successful ghostwriter demands two things: discretion and the ability to work quickly based on someone else's outline. Ghostwriting may not be the most creatively satisfying opportunity in the general field of freelance writing. Many writers don't like slapping someone else's name on their words; however, freelance ghostwriting can pay well, and can provide you with some much needed income and networking contacts during lean phases of your writing career.
Being a successful ghostwriter means sacrificing some of your own creative principles and work ethics in favor of the work. A client will sometimes come to you with nothing more than a topic idea and title, or may come to you with full chapter outlines and a directive to mimic the style of a well-known writer. This is where the question of ethics comes in. Ghostwriting is inherently on shaky ethical ground, at least in the publics eye, because the author whose name is on the book or article may not have written a single word. Readers may feel duped if they found out. However you look at it, the essence of ghostwriting is a contract: you're trading your writing ability and your agreement not to claim credit on a work for money, usually a decent amount.
If you're willing to do ghostwriting work, you need to make sure that you're not compromising any of your principles. How would you feel about writing 200 pages "in the style of Hemingway" or working on a project that involves too much research, all with someone else's name on it? If you disagree with any part of a project, then you should pass it up and find projects better suited for you.
Of course, there's always a balancing act: if you stick to your principles and refuse too many ghostwriting contracts, you may not be able to succeed financially as a ghostwriter. You could also miss some good writing contacts. If your "writing partner" is established in the literary field, or he has worked with other ghostwriters in the past, he can possibly connect you with some future assignments or throw well-paying work your way. It's up to you to think about what you will and will not do, and accept or reject offers accordingly.
Whatever the project, though, under no circumstances should you work for free (or for promises of "future royalties"). This is true for freelance writing in general, but doubly true with ghostwriting. If you're doing magazine articles under your own name for free (or for "spec," as it's called), then you have at least some leverage for collecting promised future payments if the magazine turns a profit. Your byline is on the material -- and you own it.
If you're not writing under your own name -- if you are, in fact, selling the copyright to your own work, which ghostwriting often amounts to -- you need to ask the client to pay you in advance, anywhere between 25 and 50% of the total project. Asking for payment in advance is a good sign to many clients that you're serious about your work, and a warning to anyone who's considering ripping you off. If a prospective client isn't willing to pay you a percentage up front, ask why. If you don't like the answer, then dont take the project.
If you decide not to collect an advanced payment, then you stand almost no chance of getting paid for work you've done if the client fleeces you. There are many shady businesses and individuals who use online freelancing services or post classified ads asking young, inexperienced writers to write them a book for free. These bogus classified ads promise payment somewhere down the road (as well as promises of a published background, valuable experience, and the like). It's never a good idea to ghostwrite for free. Use your valuable time to ghostwrite for money and always collect an advanced payment before you begin any ghostwriting assignment.
After you have collected an advanced payment for a ghostwriting assignment, you need to adhere to all deadlines and get the work done. Ghostwriting often has short deadlines and strict requirements about content and voice, plus the veto power of the "writing partner" (whose name is going on it, after all.) If you want to avoid rewrites, be scrupulous about sticking to whatever materials the client gives you. If the client doesn't give you anything more than a general directive, you'll have to do a bit more work, but you also have more creative freedom to put more of yourself into the writing.
At its best, ghostwriting is not only one of the more potentially lucrative fields of freelance writing, but one with an unusual degree of freedom, and a chance to get out of your own writing "skin" and experiment. If you keep your head about you, choose your clients carefully, write creatively and professionally, and follow close directions, then you can succeed as a freelance ghostwriter.