Boomer Small Business Owners: Is Being Your Own Boss in Your Retirement Dreams?
|November 20, 2018||Posted by Marcia Mantell under Boomers in Action|
There is an unending amount of conflicting data about the age at which we Boomers will retire. One statistic reports, “40% of Americans plan to retire before 60”. Another states that “the average age to retire is 62 in the US.” Yet another says, “Only 22% plan to retire after 65.”
Whether you decide to—or get to—retire at 55 or 65 or 75, what’s become very important is that you figure out what you are going to do with all that new-found time. And, I’m talking about a lot of time. It’s hard to get our arms around how many empty hours and days and weeks and months we could be talking about here. So, might you join the ranks of Boomer small owners who have become their own boss?
Small Businesses are the Engines of the American Economy
Typical news coverage centers around what the big corporate guys are up to on a nightly basis. The good, the bad and the ugly of big business. But the real action and leading indicators of our economy is happening much closer to home – – right on your own Main Street.
There are some 30 MILLION small businesses in the US. A “small business” is defined as independent businesses with less than 500 employees. And, they come in more flavors than ice cream choices at Baskin Robbins. Think about your own Main Street and all the kinds of businesses serving the community – everything from the pizza shop and local bakery to hair salons and second-hand clothing stores to the local auto mechanic and even some of the banks. We all depend on these small businesses for various needs. Including employment.
Small businesses accounted for 66% of new jobs created in the US from 2000 to 2017. They employ nearly half of all workers across the country and pay 41% of US payrolls and wages.
But who owns these small businesses, pop-up shops, and pizza parlors? Turns out, 80% of small business owners run solo. They hang a shingle or open an office and work on their own without any employees. The other 20% of small businesses (about 8,000 in total) hire employees, pay wages, and oftentimes offer benefits as well. It’s an amazing testament to the American spirit of independence and freedom.
The Importance of Small Business Saturday
What with Black Friday, Cyber Monday, and Giving Tuesday, it’s important to not forget the little stores that make each community special. For the past 10 years, the Saturday after Thanksgiving has been committed to small businesses. In addition to shopping and dining locally at brick and mortar shops, there are thousands of artisans and crafters who sell online. Etsy, in particular, has been a huge hit with shoppers and a wonderful way to find small businesses who do custom, unique work.
This year, Small Business Saturday grossed nearly $18 BILLION in sales. On just this one day. I thought this was a terrific number until I saw the 2018 holiday season forecast: holiday spending is expected to hit $720 billion in sales. What a staggering number!
That translates to only 2.5% of holiday shopping – – or even round it up to 3% – – that is directed toward our retail small businesses. Yikes. That is a small drop in the bucket of retail spending. It’s really tough for those who want to be their own boss.
Yet, a Huge Number of Boomers Are Set on Becoming Boomer Small Business Owners
Today, more than 34 million people age 55 and older are working. That’s the Boomers and even a few folks in the Silent Generation. The Bureau of Labor Statistics reports the occupations of these older workers. In the following job categories, at least one-third of the workers are 55 and older: bus drivers, furniture finishers, legislators, medical transcriptionists, real estate brokers, and tax preparers, among others.
Many hard working 55-plus folks are no longer working for someone else. Whether they chose to exit their place of work, or it was decided for them, many Boomers are looking at a long road ahead and simply don’t want to retire the old-fashioned way. Some need to save more for retirement. (And, really, who doesn’t?) Others have an idea they want to try out as a business. And others fall into an opportunity. No matter where or why you become a Boomer small business owner, you have a lot to offer thanks to 40 years of experience. Think about putting all that knowledge and know-how to work for you.
Boomer small business owners are embracing self-employment. Take a look at these statistics:
• about 8% of workers who are between 55 and 64 are their own bosses;
• 17% of those who are 65 and older are small business owners; compared to,
• only 6% to 7% of those in mid-career years bravely take on small business ownership. For the most part, younger folks work for a company. They typically rely on the benefits provided by a company, and often do not have the experience yet to run their own business.
When looking forward over the next ten years, the projections show the largest growth rate among workers will be among Boomers! By 2024, there will be about 41 million workers 55 and older, and about 13 million of those will be over 65.
What Kind of Shop Will You Set Up?
For those who will become Boomer small business owners, you might join fellow Boomers who are animal trainers, crafters, fine artists, fishing and hunting workers, hairdressers, musicians, photographers and tailors. I read this list and say, “Wow! Is there anything we Boomers can’t do?!”
Now, you might not have a crafty bone in your body or you know your voice is only meant for singing in the shower. So, you’ll have to find your own idea for a business. You might leverage the industry experience you’ve built up over your career, or start something completely new that you’ve always wanted to try. Another option is to buy a small business or a franchise. Find an area you’d love to work in and start doing your homework.
If you are thinking about going out on your own in any capacity, it is a good idea to research how to set up a small business and what requirements your state has in store for you. It’s important to understand the tax rules before you start your business. Regardless of the type of business you start, you need to file with your state and have some kind of recordkeeping in order. A good bookkeeper or accountant may save you a lot of pain during the set up and annual tax-filing requirements.
What Will You Do in Retirement?
Consider your options. Whatever you come up with will need to fill a fairly large number of hours. In fact, you should probably plan for 20 years of productive retirement years. That’s 240 months or 1,040 weeks. That’s a whole lot of time. Might as well be doing something fun and earning a few bucks along the way.
If you’re thinking about joining the ranks of Boomer small business owners, drop me a line. I’d love to hear how you are loving being your own boss.
For more information:
There are many different angles to look at when considering starting a business. Here are a couple of articles that might help you get started on your way: