LAST REVIEWED Jun 08 2020 9 MIN READ
By The Human Interest Team
As a retired individual, you can find many benefits in starting a business. Not only does it give you an opportunity to focus on passions you may not have explored in your previous career, but it can also be stimulating to both your mental and physical health. Learn the reasons why you may want to start a business later in life, the steps to take, and the best opportunities to consider.
Reasons to Work After Retirement
Author Marva Goldsmith tells The Huffington Post that individuals over the age of 50 have a “wealth of experience” from their lengthy careers that can greatly benefit them when they start a business later in life. Understanding these benefits can help you make an informed decision regarding your potential return to the workforce. Here are some of the advantages of starting a business later in life:
It Can Maintain Your Physical and Mental Health
According to Chris Hogan, working after retirement can help your mental and physical health. The Institute of Economic Affairs states that you’re 40% more likely to have clinical depression once you retire. In addition, the IEA states you’re 60% more likely to develop at least one physical condition. Having a job helps you stay physically and mentally engaged, reducing the likelihood of developing a condition.
You Have More Time
Now that you’re no longer a full-time employee, you may have more time to devote to starting a business. Even when you worked full time and thought you had a good work-life balance, the beginning of your career probably meant long hours to show your worth to your employer. Similarly, you likely don’t have to look after your children anymore, which also gives you more time to focus on building a business.
You’re More Financially Stable
It’s likely you had to provide for your family in the past. If this was the case, your business goals probably took the back seat. Now that your family is grown and your obligations have likely lessened, you can start to think about your professional goals regarding starting a new business.
It Can Make You Extra Money
Even if you have a 401(k), it’s nice to make some extra cash. If you’re successful, starting a new business can provide you with an added source of income. In addition, you can get paid for living out your passion, which is another season why it’s a beneficial venture.
It Provides You With Social Interaction
Once you retire, you’re less likely to see your old co-workers on a daily basis. Even if some became good friends with daily social interaction, these relationships may become more distant with time. If you start a business during retirement, it gives you an opportunity to socialize with others again.
Steps to Starting Your Business in Retirement
If you’re ready to start your business during retirement, you should learn about the best ways to proceed. When you make strategic decisions and follow the right steps, it can help set your business up for success. Follow these steps for starting your business in retirement:
1. Determine Your Target Audience and Market
No matter the industry you want to get into, it’s helpful to understand your audience. This involves knowing whether your products or services cater to them and if they’re willing to pay for what you have to offer. It’s important to continue to ask yourself similar questions that can help your business flourish. Essentially, it’s best to research your market and audience before officially starting your business.
2. Calculate the Initial Costs
Even though many businesses today can start with little upfront costs, it’s helpful to determine how much you plan to spend in your first year. Determine if your business requires you to keep inventory, if you need any equipment, and what you plan to spend on advertising costs. Find out how much you want to spend out of pocket, if you need to ask for a loan, and what profit you might expect.
4. Develop your Marketing Tactic
Along with considering your target audience and market, think about how you plan on reaching them. For example, can you contact them through mailing lists or would it be easier to reach them online? If you were accustomed to your company bringing clients to you, it’s likely that this part of the process if new for you. To track your audience down yourself, do your research and attract attention to your company by word-of-mouth.
5. Create a Schedule
Even if you’re not making a profit as soon as you’d like to, it’s not a reason to give up on your business. This could just mean that your business isn’t gaining the exposure it should be to yield a steady income. Keep thinking of ways to adapt, and make sure you’re giving a hard and honest look at your revenue model. You could also find out if you’re reaching your target audience as best as you can.
Best Business Opportunities for Retirees
If you’re considering entering the workforce again, you may already have a career prospect in mind. Regardless, it’s important to consider the most advantageous opportunities given your stage of life. Here are some of the best small business options to consider as a retiree:
Travel Tour Guide
Becoming a tour guide is a great and rewarding business for people with wanderlust. Not only do you have the opportunity to travel, but travel costs and other expenses are also taken care of. As a tour guide, it’s your job to lead a group of people to and from various locations.
If you’re interested in education and have a background in teaching, consider becoming a tutor. As a retired individual, you can find value in starting a tutoring business where you can hire contract tutors and use your previous teaching experience on a daily basis.
If you’re an animal lover and live in a pet-friendly location, consider providing pet-sitting and dog-walking services. Many people would rather have a person host their pets while they’re away instead of leaving them at a kennel.
Starting a business in retirement can provide you with several personal and professional advantages. The more you research your chosen industry and create a game plan, the greater chance you have of finding success. Of course, we’re always here to help you with your small business needs.
The Human Interest Team
We believe that everyone deserves access to a secure financial future, which is why we make it easy to provide a 401(k) to your employees. Human Interest offers a low-cost 401(k) with automated administration, built-in investment advising, and integration with leading payroll providers.