Entrepreneurship is Alive and Well Among Older Adults
By Teresa Ambord
Many employees dream of becoming their own bosses. If you’re over 50, you may think it’s too late. But entrepreneurship is thriving even in this age group.
Since 1990, the number of self-employed individuals aged 50 and up has risen 23 percent and is still rising. And one out of three of these people didn’t make the switch to self-employment until after they turned 50.
Why are older workers taking the leap and becoming their own bosses? Many reasons, including a simple transition into retirement.
- Some have been downsized or fear that they will be downsized out of their wage/salary jobs.
- Others have grown tired of being under the thumbs of oppressive bosses.
- Some want more flexibility and the ability to work fewer hours so they can spend more time pursuing hobbies or being with their families.
- And many have physical limitations that make it hard to work full-time or keep a firm schedule.
Who are these older entrepreneurs?
The majority tend to be male, married, white, and college-educated. In the group as a whole, females who start businesses tend to be younger than their male counterparts. They are also more racially diverse, and are more likely to be single.
Do self-employed individuals fare better financially than wage/salary workers? You decide.
- The average financial wealth for self-employed individuals 50 and over is $740,000. For the same age group, employed, $240,000
- The median financial wealth for self-employed (50 plus) is $312,000. For wage and salary, $119,000
If starting your own business appeals to you, log onto the Small Business Administration Web site and take a look at their business start up guide:
According to the SBA, the best way to improve your chances of success as an entrepreneur is to do adequate planning and preparation. Here is a self-questionnaire from the SBA to help you determine if entrepreneurship is for you:
- Are you a self- starter? It will be up to you - not someone else telling you to develop projects, organize your time and follow through on details.
- How well do you get along with different personalities? Business owners need to develop working relationships with a variety of people including customers, vendors, staff, bankers and professionals such as lawyers, accountants or consultants. Can you deal with a demanding client, an unreliable vendor or a cranky staff person in the best interest of your business?
- How good are you at making decisions? Small business owners are required to make decisions constantly, often quickly, under pressure, and independently.
- Do you have the physical and emotional stamina to run a business? Business ownership can be challenging, fun and exciting. But it's also a lot of work. Can you face 12-hour work days six or seven days a week if necessary?
- How well do you plan and organize? Research indicates that many business failures could have been avoided through better planning. Good organization of financials, inventory, schedules, and production can help avoid many pitfalls.
- Is your drive strong enough to maintain your motivation? Running a business can wear you down. Some business owners feel burned out by having to carry all the responsibility on their shoulders. Strong motivation can make the business succeed and will help you survive slowdowns as well as periods of burnout.
- How will the business affect your family? The first few years of a business startup can be hard on family life. The strain of an unsupportive spouse may be hard to balance against the demands of starting a business. There also may be financial difficulties until the business becomes profitable, which could take months or years. You may have to adjust to a lower standard of living or put family assets at risk.
If you want to start a business but the level of risk worries you, you might consider purchasing a franchise. There is still a great deal of risk involved, but rather than starting from ground zero, you begin with an established name and have the benefit of guidelines and experience of a successful enterprise. Here is some helpful information from the SBA about franchising:
