Are you questioning your retirement plans? Not sure if you’re ready to leave the workforce?
A new business venture might be just what you’re looking for!
Deciding to work during retirement is a personal choice, but it’s gaining popularity. A new study found that 76% of Boomers want to keep working in retirement, and most don’t want to try their hand at something new.
While there are tremendous benefits to adventuring into the business game, there are also significant risks.
Before diving into this exciting venture, it’s always a good idea to ensure that entrepreneurship aligns with your ideal retirement lifestyle.
Finding Your “Why” During Retirement
Do you have a strong passion that you want to develop even further?
Crafting your favorite hobby into a new business venture is a clever way to keep your retirement years lively and fulfilling. The options are truly unlimited! Here are just a few examples of the direction your new business could take:
- Food (gardening, cake decorating, fresh baked goods, local and home-based cooking for neighbors, etc.).
- Creative passions (art, music, artisanal goods, etc.)
- Non-profit work
Whether you want to consult part-time in a familiar industry, sell your incredible local veggies at the farmers market, start giving piano lessons, or anything in between, you can take your skills and passions to the next level by monetizing them in retirement.
But don’t let this list limit you! From shipping snow to packaging potato parcels, thousands of entrepreneurs have come up with odd yet successful small business ideas. Yes, these are real businesses!
How to Start a Successful Business as a Retiree
So, you’re ready to take the leap and start a business! That’s great! But, where do you go from here?
Step 1: Create a Solid and Secure Business Plan
The first step of entrepreneurship is organizing your new business venture.
Here are a few key ways to set your business up for success:
- Create company values
- Values are the springboard for the entire operation. Knowing your values allows you to set better goals, connect to your customers, and ultimately make more high-quality products.
- Establish your business goals
- Like your financial plan, your business plan should start with your goals. What do you hope to accomplish? Do you want to work part-time or full-time? Would you like the business to continue when you step down? Thinking through these things now will help you be more fulfilled in your role.
- Describe your products and services
- Sometimes describing what you do can be the most challenging part of starting a business. Try to keep your products and services streamlined, clear, and value-driven. Consider what your ideal customers want, what you’re really good at, and go from there.
- Do your market research.
- You won’t put your best foot forward if you don’t know “what’s out there.” Take a look at the types of businesses that already exist in your area of interest. How does yours differ and bring more value? What is your ideal customer base? How are goods and services priced in this field? All of this information can help you create a more robust plan.
Step 2: Establish a Concrete Financial Plan (and a Strong Retirement Plan)
New businesses always have start-up costs. But before you invest that first dollar, you’ll want to fully understand how much funding your new business will require.
Creating a financial forecast plan lets you prepare yourself by illustrating a money investment timeline. Once you have your financial picture, you can better understand the feasibility of your business venture.
At the same time, your retirement plan might require some adjusting to match these new financial goals. You can work with your financial advisor to make sure nothing falls through the cracks.
4 Key Benefits of Being an Encore Entrepreneur
1. You Are Likely a Highly Skilled Expert in the Field You Choose to Pursue
Most people choose to pursue fields where they have extensive experience. For example, if you’ve built your career as a marketing executive, you may want to open a consulting firm, write part-time, or even teach a relevant course.
By transforming an existing skillset into a new business, you can utilize your personal wellspring of knowledge.
2. You Have Many Years of Useful Experience Under Your Belt
You’ve cultivated decades of work experience, productive habits, and creative ideas. All these things lend themselves to entrepreneurship. You might be surprised to learn that many retirees take up entrepreneurship after they leave their employer.
In fact, more than 25% of new entrepreneurs in 2019 were between the ages of 55 and 64. That’s a 15% increase from 1996!
3. You Have a Huge Appreciation For and Find Fulfillment In This Area
One of the great benefits of entrepreneurship is that you can pursue an area that inspires you. Finding inspiration, passion, and purpose is critical for retirees’ health.
Research has uncovered that lack of purpose can increase a retiree’s risk of physical and mental health conditions. So, engaging in meaningful work helps you stay happier and healthier in your golden years.
4. You Have a Strong Work Ethic Because You’re Choosing to Work!
Being your own boss adds a new layer of depth and devotion to your work. You’re putting in hours out of passion, not of obligation. This dedication creates a unique and gratifying work ethic that helps drive success.
2 Important Risks to Consider Before Starting a New Business
While going into business for yourself can be a wonderful experience in retirement, it’s not without its risks. Let’s review two of the most important ones to consider.
1. You Might Be Forced to Dedicate More Time Than You Expected
While businesses are full of excitement and creativity, they’re also a lot of work.
Sometimes, not everything goes as planned. These mishaps and misunderstandings can increase the amount of time you have to dedicate to your business.
Your time is precious, and it’s essential to keep this risk in mind if you don’t want to lose any hours of retirement freedom.
2. Building a New Business Could Be A Financial Risk
No matter how thorough your financial plan is, it’s impossible to eliminate all risks. From unpredictable pandemics to natural disasters, a significant barrier can always unexpectedly pop up.
This risk is even higher as a retiree since you no longer have years of wages ahead of you. As a result, any money lost in the business will be much harder to replenish.
Having a solid understanding of your financial situation, risk tolerance, and retirement lifestyle is key to minimizing these threats.
Try a Financial Consultation First
Still trying to decide if a new business venture is the right move?
Our fiduciary advisors at Goepper Burkhardt Wealth Management have the answers you’re looking for. Whether you’re located next door in Greenville, S.C., or across the country, we’re here to help. Meet with us in person or virtually to better grasp your entrepreneurial plans.
Before making any big financial moves with your retirement savings, it’s important to review all your options. We can help you analyze your current financial situation and offer personalized retirement advice to help minimize risk while maximizing fulfillment.
Ready to make wealth management easy? Reach out to us to get started.