BuildYourOwnBusiness:
As part of the Boomer Generation, you will be retiring in the next few years. Do you want to fully retire, or would you like to work from home on flexible hours that generates supplemental income to preserve your retirement savings and is fun to boot? Becoming an entrepreneur and working for yourself is a viable option that many retirees are doing.
You have worked hard and planned for retirement and here it is staring you squarely in the face. Reaching this point can be a blessing and a curse. You eagerly anticipated retirement, but you have some nagging doubts about what retirement holds for you.
Perhaps, the major doubt you have is financial. Modern medicine has had a major impact on your retirement planning. When you formulated your retirement savings plan 30 years ago, you did not think that you might live as long as you probably will. You want to live a long, healthy life, but in doing so, you could potentially outlive your retirement savings. The answer to this dilemma - become an entrepreneur. Working after retirement can substantially extend your retirement savings.
Well, if you become an entrepreneur after retirement you will be in good company. Several studies show that the fastest growing group of entrepreneurs are aged 60 and older.
Just what is an entrepreneur? The word comes from the French word ‘entreprendre’, which means ‘to undertake’. Let’s get a definition from the Merriam Webster Dictionary. It defines entrepreneur as ‘one who organizes, manages, and assumes the risks of a business enterprise.’
Don’t let this frighten you. It’s an opportunity for you to expand your horizons and to become your own boss. Possibly, this has been your long term dream.
Some people wonder if they are too old to become an entrepreneur upon retirement and if being over 60 is too old for entrepreneurship. Recent studies indicate that the odds are in the favor of the older entrepreneur. Recent studies show that 22% of men and 14% of women over 65 are self-employed. That’s compared to just 7% for other age groups.
According to a Vanderbilt University study the number of entrepreneurs age 45 to 64 will grow by 15 million by 2006. This is compared to a 4 million decline for entrepreneurs age 25 to 44.
According to a 1998 survey of baby boomers conducted by the American Association of Retired Persons (AARP) 80% of respondents planned to work beyond retirement age, and 17% of those planned to launch new businesses. The same study noted, ‘Self-employment among American workers increases with age, with the most dramatic jump occurring at age 65.’
Older entrepreneurs have an advantage over younger entrepreneurs because older entrepreneurs tend to have more experience to draw from and more assets with which to finance a business. The bumps and scrapes of life are a stern teacher.
More information can be found in a report published by Barclays Bank entitled ‘Third Age Entrepreneurs - Profiting From Experience’. The report shows that older entrepreneurs are responsible for 50% more business start-ups than 10 years ago. This amounts to approximately 60,000 business start-ups last year alone.
The Barclays survey also showed that today’s third age entrepreneurs (entrepreneurs over age 50) don’t mind putting in the hours required to build their business. Nearly 49% indicated that they work an average of 36 or more hours per week. The third age group rated holidays, lack of stress and a balance between work and home life more important than their younger counterparts.
The report further showed that only 27% run the business as the only source of household income, with 51% supplementing their pensions.
Other key findings showed that third age start-ups account for 15% of all new businesses, and third age entrepreneurs are three times more likely to be male than female. The downside is that many businesses fail within the first few years and older entrepreneurs may be less able to handle the financial loss than younger entrepreneurs. If you lose everything at age 25 you have time to recover, but it’s a much bigger hit to lose everything at 65.
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Very interesting stats from Barclays. Thanks for posting them.
There tends to be a significant difference in motivation between retirees and pre-retirees. The former start a business more for passion that money, so you wonder how long they’ll stick it out. The latter need income to bridge them into retirement and pay for their health insurance.