Yahoo Finance I’m a Financial Expert: Here are 7 Things Boomer Entrepreneurs Need to Know About Starting a Business
There are various reasons why someone may want to start a business in their golden years.
Perhaps they’re retired and miss the workforce. Maybe they’ve always nurtured a passion for entrepreneurship that they’ve never been able to explore. Or, it could be that they need the money their own business could produce.
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Whatever the reason for starting a business later in life, Boomers need to know what they’re in for. GOBankingRates spoke with financial experts to break down the seven things Boomers must know before going into business for themselves.
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Understand Your Financial Position and Retirement Needs
It’s critical when starting a business later in life to balance your entrepreneurial goals with your retirement needs.
“It’s crucial to have a clear understanding of your current financial situation and how much risk you can afford to take,” said Matthew Stratman, president of United Tax AI.
Stratman recommended conducting a thorough review of your finances, including retirement accounts, savings and any other sources of income. The goal here is to be sure you have financial stability.
“By ensuring your financial stability, you can pursue your business venture more confidently and reduce the risk of jeopardizing your retirement security,” Stratman said.
Plan for Health and Longevity
Running a business can be mentally taxing and, perhaps even physically demanding, depending on your interest. Be sure to always factor in your health and aim for longevity.
“Incorporate health and wellness into your daily routine,” Stratman said. Schedule regular check-ups, maintain a balanced diet, and exercise regularly. Also, plan for contingencies such as delegating responsibilities or having a succession plan in place in case of health issues.”
Be Careful About Withdrawing and Investing Funds
Starting a business requires upfront investments. Be cautious here, advised Mark S. Gottlieb, an attorney and CPA with MSG, “particularly if you’re borrowing from a bank, or from your pension.”
Create A Realistic Projection of Expenses
Just as you need to budget for your everyday life, you need to budget for your business. How much will you need to spend to keep
“Create a realistic projection of not only the business’ expenses but also consider your living expenses so as to not jeopardize your lifestyle,” Gottlieb said.
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Consider the Legal and Tax Implications
Bear in mind that starting a business comes with legal and tax considerations. Stratman pointed out that these can be complex — especially when you have other retirement income sources to consider. Don’t cheap out here. Get professional help from legal and tax professionals.
“Proper legal and tax planning can save you money, prevent legal issues and ensure compliance with all relevant regulations, allowing you to focus more on growing your business,” Stratman said.
Be Prepared to Protect Your Business
Remember: A business needs protection like any other asset. Be sure to cover your bases.
“This includes the proper business structure, insurance (property and casualty, business interruption, errors and omissions/professional liability, worker’s compensation),” said Michael Santiago, senior financial editor, Annuity.org and RetireGuide.com. “You don’t want to overlook non-disclosure agreements or copyright.”
Stay Updated with Technology and Market Trends
“The business landscape is constantly evolving, especially with the rapid advancements in technology,” Stratman said. “Staying current is essential for remaining competitive and relevant in today’s market.”
Stratman suggested investing time in learning new technologies relevant to your industry.
“Attend workshops, webinars and industry conferences,” he said. “Being tech-savvy and aware of market trends will enable you to make informed decisions, streamline operations, and effectively reach your target audience.”
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This article originally appeared on GOBankingRates.com: I’m a Financial Expert: Here are 7 Things Boomer Entrepreneurs Need to Know About Starting a Business
