There are two main reasons why you might consider taking the business startup plunge after retiring:
- You need extra money.
- You want to pursue your passion.
If you were laid off or forced into an early retirement, you may feel like you need to supplement your savings with a new income stream. Starting up your own business can help you:
- Keep up with inflation. Or better yet, outpace inflation. Many retirees are still reeling from the 2008 financial crisis and are concerned about the ability of their investment portfolios to grow enough to supply retirement income for decades as prices rise.
- Maintain your pre-retirement lifestyle. You may be looking at spending 30 years or more in retirement and maintaining your lifestyle will require the same type of growing income you experienced with regular paycheck raises earlier in your career.
- Provide for an extended family. The extra money from a business could enable you to financially help your adult children, grandchildren, and aging parents, without making as big a dent in your own lifestyle.
- Pay off mortgage debts. Many boomers are heading into retirement still owing substantial sums on their home mortgages. If you’re one of them, paying down those debts can provide more financial security as you age.
Pursuing a Passion
For some, starting a business is something they do simply because they never want to sit still and are always searching for new challenges. Three common motivating factors for launching a business venture are:
- To realize a dream. Whether you loved your job or considered it just a paycheck, building your own business can be a fresh opportunity to throw yourself into something you truly care about.
- Being more flexible and taking control. While launching a startup takes a lot of time and effort, you’ll be in charge, which gives you the flexibility to work on your own timetable. Once your business is established and you can delegate tasks, you’ll have the freedom to take those three-day weekends. Or not!
- Investing in yourself. Get better at what you do by taking classes and enhancing your personal brand. Your business will have a greater chance to prosper which will pay off with increased financial security.