Seniors have some serious advantages over their younger counterparts when it comes to starting a business, including:
- Established credit, which can make it easier to access start-up capital.
- A track record in their industry.
- Proven leadership skills.
- Confidence in their abilities.
Action Steps
The best contacts and resources to help you get it done
Plan before retirement
Businesses require planning, and the most successful take years' worth. Start dreaming early on and consider making your new venture a part-time one while you're still working in order to minimize risk; if it works out, you can expand into a full-time operation upon retirement.I recommend: Get help with your business start-up at AARP's Self Employment Web page, which includes small business resources especially for entrepreneurs over 50. Or, approach the Service Corps of Retired Executives (SCORE) for individual advice, given in person at SCORE offices or via email through the Ask SCORE program.
Do what you know and love
By the time you get to retirement you'll have many years of work experience behind you. Use that experience, and all that you've learned from it, to develop a business idea about which you'll be passionate and at which you'll succeed.I recommend: You don't have to leave your industry to become an entrepreneur. Consider capitalizing on your experience by becoming a consultant. Get advice from peers who have already made the transition to consultancy; find them in the member directories of the Association of Professional Consultants (APC) and the Professional and Technical Consultants Association (PATCA).
Write a business plan
Just because you're older than most new business owners doesn't exempt you from going through the necessary motions of a standard startup; you'll need a solid business plan, just like anyone else.I recommend: Facilitate the writing process with business plan software, such as Business Plan Pro, which also offers sample business plans.
Build networks
Take advantage of your contacts by approaching them for help in financing, marketing and even patronizing your new business.I recommend: If you've lost track of folks in your Rolodex, locate them online in Switchboard's White Pages. Or sign up for Plaxo, a service that automatically updates your address book.
Secure financing
Like any startup, your new business will need money to get off the ground. Avoid using funds from your retirement savings or pension, however, to finance your business. Instead, finance your business with a separate savings account, line of credit or bank loan.I recommend: Use AARP's Retirement Calculator to find out how much money you'll need for retirement; combine any extra savings with small business loans, such as those offered by the U.S. Small Business Administration (SBA).
Tips & Tactics
Helpful advice for making the most of this Guide
- A business must be more than a way to occupy idle time. If you're serious about turning a hobby into a business opportunity, approach the venture focusing on profit rather than amusement.
- Make your new business a family business in order to share risk while also spending more quality time with your relatives, not to mention building a legacy to leave them when you're gone.
- Consider purchasing a franchise; franchises carry less risk and many have programs and host seminars especially for retirees.
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