The Kauffman Foundation reported that more Baby Boomers are starting new businesses: “Americans 55 to 64 started 24.3 percent off new businesses last year, up from 14.8 percent in 1996.“
And while these Americans will be able to rely on their years of experience and contacts, many will not have unlimited funds to rely on as they launch their new ventures so they should plan carefully. In fact, one expert told The Washington Post that he advises retirees who want to start businesses to consult so they can have gain income without having to hire employees.
Here are some things to consider:
Make a plan. Even if you have decades of experience, you will still need a business plan. Not only will you need to consider finances, you will also have to think about legal protection and taxes.
Decide what the dream is worth to you. How much can you invest in your business before it is too much? If you have waited your entire life to finally start your business, it can be tempting to put all your money (including retirement funds) into it. If you don’t make a profit, you may need to return to work.
Seek help. While we know that many retirees have a wealth of knowledge and may be experts in their fields, there is always something one can learn. Don’t be so certain that you can handle all the aspects of starting a business. Get advice from others and seek the help of a Fee-Only financial planner.
Think about your time. There is nothing wrong with working when you are retirement age but will your business idea take up more time that you imagine? Sure, you don’t want to just sit around during retirement but do you want to devote most of your waking hours to your new business? Depending on the kind of venture you choose to launch, you may end up doing that.