Second Act Success

Launching Your Dream Business After Retirement

With retirement just around the corner, it’s time to consider your future. You want your second act in life to be impactful and fulfilling. This may be the perfect time to launch your dream business. However, there are many challenges and opportunities involved in launching a business after retirement. This article explores what it takes to turn your passions into a successful enterprise. 

Turning Passions Into Profits

Many of us want to turn our passions into a business venture. Maybe you love to travel and want to join a travel agency. Perhaps you have an eye for design and would love to be an interior designer. If you help others, you may want to be a life coach.

Those are some wonderful ways to get into business. Before taking that leap, you must take stock of your skills. In order to become an entrepreneur, you will need to develop:

• Research skills. Collecting and analyzing data about your customers and the marketplace are necessary skills for business owners.
• Marketing prowess. Marketing products or services that appeal to your target customer is a must to build and grow your business.
• Adaptability. Being flexible during economic highs and lows ensures you stay in business for the long haul. 
• Planning abilities. Creating a solid business plan for the life of your company helps ensure success.

Start your business plan by deciding if you’ll open a corporation, an LLC, or a sole proprietorship. Each has different options for taxes and liability so choose wisely. You can also look into local business resources to help create your business plan.

Identifying Opportunities

Having or developing the necessary skills to be an entrepreneur will help you identify opportunities to build something you love. Consider the following options:

• Creating your own business. This is an excellent choice for someone who coaches people or creates their own products. Seek out small business owners in similar fields for advice on getting started.

• Opening a franchise. This works well for someone with managerial experience who wants a plug-and-play opportunity. Meet with a franchise consultant to learn what options are best.
• Becoming a contractor. This is a good fit for anyone who has extensive experience in a field such as information technology or construction. 
• Being an influencer. This is something to consider if you have a social media presence and like to create content. Research building your presence online for income opportunities.

One of the best ways to learn more about the opportunities above is by talking to people with experience in these areas. Get in touch with former colleagues and other professional contacts for advice. 
Your local community will have resources too. Your local chamber of commerce should have plenty of resources and information to guide you. You should also check out small business networking groups in your area that welcome guests. 
Once you know you have an idea for a business, it’s time to look at the business challenges you may face.

Overcoming Financial Challenges 

Starting your own business during retirement creates unique financial challenges. Begin by  creating a business plan and determining what startup and future expenses your business will require, such as:

• Office or warehouse space and utilities;
• Software, hardware, and other IT services;
• Franchise fees;
• Legal expenses;
• Vendor costs;
• Staffing. 

One of the biggest challenges for retirees who want to become self-employed is avoiding dipping into retirement funds for startup costs. This can put your income at risk and increase your tax burden. Using credit cards can cause financial trouble. 
You may want to consider business or government loans and grants. Applicants over age 55 tend to have an easier time securing these. 
Business and personal income, expenses, and investments must also be kept separate. Hire an accountant or financial advisor to help you make these decisions.

You should also factor in the unexpected costs of running a business. This includes protecting yourself from theft, insuring yourself against liability, and protecting your stock and supplies. 
For example, when you run a product-based business, you should write a return and refund policy before selling any items to protect your business. Be sure to include information like how long customers have to return an item, if they need the receipt, and what condition the item must be in. Tell customers exactly how the refund or exchange works. The more you detail your policy, the better customers will understand it.

You can also supplement your retirement income before starting a new business to accumulate seed money. Some ideas include working as a contractor, leasing property you own, or selling assets. Invest wisely by purchasing municipal bonds, which have tax benefits.

You can also buy an annuity. This is when you give your life insurance company a sum, which they hold for you. They send you regular deposits, or annuities, from that sum, allowing you to secure a consistent income.

Launching a business after retirement allows you to live out your passions. Find the right opportunity and procure the required funding before bringing your dreams to life. It will be worth the effort to leave a legacy that impacts the world for good.
By Indiana Lee, BOSS contributor