Just because you’re retired doesn’t mean you have to stop working.
You could be one of the many Canadians who have found fulfillment by turning passion into prosperity.
Many retirees aren’t ready to call it quits. In fact, plenty of people use their retirement years to pursue business opportunities they could never find the time to start up while they were working a 9 to 5 job. Now that you’ve made the decision to retire, it could be the perfect time to turn your small business dream into a reality.
You may want to consider launching your small business before you retire. You’ll still have a steady source of income to help finance your start-up.
But how can you start your own company? Here are few steps you’ll need to take.
Talk to your family
Decide how much time you plan on putting into your business and consider your energy level and your medical condition. Sit down and have a conversation with your family to determine if they are comfortable with the amount of time and money you plan on devoting to your newfound endeavour.
Seek out opportunities for training and mentoring that will help determine whether you’re cut out to be a small business owner. A local community college that offers business courses is a great place to start. Most importantly, you need to decide for yourself if this is something you are doing as a hobby, or if you are motivated by the prospect of earning a reliable second source of income.
Start before you retire
If you’re still employed, you may want to consider launching your small business before you retire. A small business doesn’t normally turn a profit in the first year or so. If you’re still working, you’ll still have a steady source of income to help finance your start-up during a time when profit margins are razor thin.
Work with an advisor
It’s also a good idea to work closely with a financial advisor to review your financial plan. This allows you to determine whether you can afford to start up a new venture and understand the impact the new venture could have on your retirement.
Explore “crowdfunding” options like Kickstarter and Indiegogo, which give you the ability to solicit funds from anyone to get your business started. Remember that the funds raised through a crowdfunding campaign are generally viewed as business income and therefore considered taxable. There are also numerous government-related grants that one can tap into.
Remember, it’s never too late to follow your dream of becoming your own boss. No one cares what age you are when you choose to start your small business. It’s the idea and the execution that counts.
How to stay passionate about work
As enjoyable as it can be to run a business, it’s often hard and draining work. What do you do if the excitement starts to fade?
Celebrate your success
Reflect back on your successful moments and draw on those instances for inspiration. It’s easy to stay motivated while everything is going your way – the challenge is feeling passionate when things aren’t as great.
Learn something new
A great way to motivate yourself and feel more connected to your work is to approach it with a fresh set of eyes. Expand your horizons by attending a conference or a lecture to sharpen your skills. Sign up for an online class or webinar. Look for free tutorials on a website like YouTube, or do a Google search related to your passion and absorb some fresh, new content.
Take some “me time”
One of the biggest reasons people lose passion for their work is because they immerse themselves into it too deeply. The importance of maintaining a healthy balance between work and quality time for yourself cannot be overstated. Start out by spending a few minutes every day trying something that will help you relax and rejuvenate. It can be something as simple as taking a walk or planning an itinerary for a nice vacation.
Can I afford to fail?
Older entrepreneurs don’t have much time to recover from a business failure. They have to be careful and minimize their risks.
Resist the urge to splurge on your brilliant new business idea
As tempting as it might be to pour money into your new business venture in hopes of ensuring its survival, you would be well advised to keep your start-up costs to a minimum. Avoiding heavy debt and choosing a business structure that will protect your retirement savings will pay off in dividends.
A recent Industry Canada study concluded that 30% of small businesses won’t survive longer than two years, and only half make it to five years. This is the reason why you shouldn’t do things like lease office space or hire an assistant until you absolutely have to. Big expenses like these eat into profit margins immediately making it even more difficult for your business to survive.
Be smart and test the market
If you plan on selling a particular product, test the market before you make any rash decisions. Donate the item to a silent auction or try to sell it online. Start with the most basic version of your product or service, and wait for customer feedback before you start sinking serious money into it.
Market your business by using free social media sites, like Facebook, Twitter and Instagram. Get involved with business networking groups, which you can find on websites such as Meetup.com. Networking is almost always free, and one of the easiest things to do.
Taking these simple steps before you get your business off the ground can give you an idea of the interest surrounding your idea. Knowing this knowledge in advance can help you decide if your business venture makes sense from a financial perspective.
Keep it simple
Above all else, start out by keeping your business small and finance it with money that you can afford to lose. Think of a worst case scenario where you lose every single penny that you have invested into your business. Would it dramatically change your life? If that’s the case, you may want to reconsider your decision.
If you find yourself becoming tempted to tap into your retirement accounts to fund your business, that’s probably a red flag that you’re about to get yourself into something you aren’t financially prepared for.