According to the Kaufmann Foundation, the highest rate of successful entrepreneurship is among those 55-64 – twice the success rate of those age 20-34. Even though many older people nearing retirement are continuing to work, starting a business could be something that would allow you to pursue an interest that you’ve always had, give you a chance to work with your ideal clients, and get paid your real worth.
AARP, in fact, has a 40-million investment fund for businesses in the health, elder care, and wellness space. The organization wants to stimulate the development of products and services for older adults while increasing awareness of concepts such as ageless design.
You can use the money from your new business to supplement your income, build legacy wealth to pass on to your grandchildren, (let’s face it your children are not really important, anymore) or pay for leisure activities such as travelling or a winter home.
Working as a boomer business owner can sound romantic. But it’s not always dreamy as you might think. The first step is getting clear about your life plan at this point in your life.
Ask yourself a few questions:
- What do you want now and why?
- How much energy do you have to start something new?
- How much money can you afford to risk?
- Are you flexible and coachable?
- Do you have any competing priorities? (Aging parents, an ill spouse, small grandchildren whom you help raise)
Once you take the time to answer those questions, there are a few key things you’ll want to consider.
5 Keys Areas to Consider When Starting a Business Over 50
Start-up Costs
The first consideration is how you will fund your venture. Will the money to start your business comes from your personal savings or retirement funds. It takes 24-36 months for a business to breakeven let alone replace your corporate salary. Are you prepared to go without a paycheck for a year or two?
Business Experience
Having the right business background is extremely valuable as a start-up business. If you are a CPA and you want to start an accounting firm, that’s not a huge leap. If you want to start a business in an industry where you have never worked, such as running a bed and breakfast, a restaurant, e-commerce business or consignment store, you might want to take time to work for a business like the one you want to start to get some experience.
Know Your Customer
If everyone can use your product or service, no one will. You need to have a specific niche target customer.
Use surveys and customer research to make sure you are clear on the market opportunity, competitors, your pricing model, distribution channels and how you will get the word out that you are open for business.
Plan Your Business
Are you confident enough in your idea? Doubt kills more businesses than a bad marketing plan.
By developing a well thought out business plan, you will reduce your fear. By the way, the most common personality trait shared by successful entrepreneurs is confidence. The business world is fiercely competitive, 90% of what you are selling is yourself, so you need to be willing to fight for your share of the marketplace.
Start as a Side Hustle First
Only fools rush in! Unless you are starting a business that is competitive with your workplace, start your business on the side. When it starts making real money, then you can leave the job. Learn the toughest lessons in business while you still have paychecks rolling in.
When thinking about starting a business over 50, there are a lot of options. You can buy a business, sell information online, drive a tech start-up, sell your existing employer back something they outsource, or turn a hobby into a business. Just be sure that when you evaluate a business idea, you consider if you have the money, time and expertise or know where to get it. Will the business be relevant three years from now? Do you really have a shot at marketing your idea, or you have too dominant of a competitor?
You’ll also want to consider if you want a business that requires 20 hours a week or one that requires 60-hours. Your mindset will be critically important to pull this off.
Starting a business over 50 doesn’t need to be scary. Remember, you are just one idea away from being able to do anything you want. Retirement can wait. Launch a business and run things your way so that you can enjoy the fruits of your hard work.