Wed jan 16, 2008
Starting a business after retiring is possible
Q. I recently retired with good retirement assets after managing a business for 30 years. I'd like to start or buy my own business. Is it too late to do that?
A. There's no right or wrong answer to that question. It depends on the individual. First, make sure you have good health, energy and the passion to own and run your own business. If so, your business experience, knowledge and mature wisdom are big advantages.
Having a secure retirement income that is not dependent on the business is a big advantage. Make sure you don't put your retirement income at risk to claims against the business. That can be done by selecting the right legal structure for the business.
Don't expect instant success and wealth. Most businesses grow slowly and it takes years to accumulate valuable assets and net worth. It also takes years for a business to grow sales, revenue and net profit that make a business a valuable asset for the owner. Your age tends to limit the ultimate investment value of the business. You just don't have the remaining time to work on it that a younger person has.
It helps a lot to have experience in managing a business for someone else before starting a business on your own. In your case you had the opportunity to learn from your mistakes at someone else's expense. You also have learned the basic business functions like marketing, finance, accounting and personnel at someone else's expense.
Whatever business you start or buy, you must know how to produce the product or service that the business provides. You may not produce them yourself but you must know how to train and supervise employees and establish credibility with customers. If you are buying a business, require the previous owner to remain until you are trained. If you plan to start a business in an industry you don't know, work for someone else to learn that business.
If you have assets in excess of that needed for retirement income, they can be used as collateral for loans to buy or start a business. Banks and other lenders normally require 100 percent collateral for business loans. Younger people usually have not accumulated sufficient assets to obtain loans to own a business. Lenders also like the owner to have a long, successful resume. The owner's resume is as important as collateral.
Your age may be an advantage in establishing credibility with customers, employees, investors and bankers. If your product or service is complex and expensive requiring follow on service, your credibility is important in making the sale. If your customers are older, age may by an advantage in establishing rapport with them. If your employees are older, your age and experience will be an advantage in convincing them you can cope with the problems and run a successful business.
The owner's business knowledge, experience and wisdom are invaluable in running a successful business. Decisions are quicker and better, mistakes fewer, problems are avoided or solved sooner, disputes and crises avoided.
Source:http://www.caller.com/news/2008/jan/15
/starting-a-business-after-retiring-is-possible/
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