RMIThe Low-Risk Method To Start A Business In Retirement
By Chris Farrell, Next Opportunity Contributor
The pull of entrepreneurship for boomers trying to find extra earnings in their Unretirement is its flexibility and the prospect of tailoring a venture to their desires. But numerous fear that starting a company in your 60s is too high-risk which they’ll require to tap their retirement savings to do it.
To this, I have two responses: It doesn’t need to be dangerous and there’s no factorneed to touch your 401(k) or IRA for start-up capital (in fact, you absolutely shouldn’t).
Low-Cost Sideline Companies
Thanks to the increase of the Web, mobile technologies and the sharing economy, solopreneurs, microentrepreneurs and other boomerpreneurs are discovering it can take veryhardly any cash to open a sideline company. They’re offering craftwork and art work, rentingrenting a space, producing online communities, driving for Lyft or Uber and other similar endeavors.
(MORE: Ways to Participate The Sharing Economy)
Judith Rosenberg, 69, is a powerful advocate for setting up a small businessa small company that produces “residual earnings”– a recurring stream of profits– during retirement. “People have to be a lot more entrepreneurial. They have actually been trained to be staff members and need to alter their frame of mind,” states Rosenberg, who resides in the San Francisco Bay location.
Rosenberg practices what she preaches. The previous executive director of a nonprofit concentrated on community management is now using her experience to construct The SAGE Centers. Based in Berkeley, Calif., this organization focusesconcentrates on encouraging individuals over 50 to support and learn from one another as they develop their companies.
Rosenberg is creating a stream of residual income for herself by releasing a 30-page ebook ($3.99) called Financial Security After 50: Residual Income Solutions. She’s also near introducing a via the internet membership program to expand her community of like-minded business owners.
(MORE: Franchising in Retirement)
Multiple Earnings Streams
The development of a via the internet community reflecting a passion for, state, books, travel, pets, food or, in Rosenberg’s case, residual income entrepreneurship, opens the possibility of several earnings streams. These might include some mix of advertising, product sales, subscription charges, online classes, ebooks and purchases through Amazon, Commission Junction or another affiliate program. (An excellent online overview into the possibilities is Problogger.net, the site of Darren Rowse.)
Obviously, aside from the rare and often fortunate exception, these labor-of-love digital ventures are no roadway to riches. “You will not make a ton of cash,” states Steve King, founder of Emergent Research, a consulting company based in Lafayette, Calif., focusedconcentrated on the small companysmall company economy.
Numerous 60+ boomerpreneurs are imitating the work way of life of writers, dancers, artists and other artists. Other than for an elite few, the majority of artists generally run numerous side companies to earn a living while staying participated in their craft. For instanceFor example, a modern dancer may teach children at an after-school studio and work as a part-time fitness instructor at a regional health club; an author might offer manuscript-editing services and offer books online.
Likewise, taking benefitbenefiting from the digital and sharing economy “lets you test your business concept” on the cheap, states King. “You take a little risk and if it doesn’t exercise, it doesn’t work. If it does apprehend on, then you grow the companybusiness, if that’s exactly what you wantwish to do,” states King. “Extremely fewFew companies need capital these days if you’re willing to start small.”
Airbnb: Turning Your House Into a Company
Airbnb, which lets individuals rentlease spaces in their houses to visitors, is ending up being a popular way to rake in extra income for people who’ve cut down their working hours. For instance, Susan Clarke, who provides chiropractic care from her St. Paul, Minn. house 3 days a week, joined Airbnb in 2014. She rentsleases a huge double space in her home; the side business brings in about $800 a month.
Stephen Wolcott, of South Bay, Calif., earns cash through Airbnb and through part-time taxi driving. A longtime writer and manufacturer in the Los Angeles home entertainment marketshow business, Wolcott says he and his wife– a nurse– started “to think outside the box” once their kid entered college.
They dealt withspruced up a space in their home and signed up with Airbnb, swiping $2,000 a month, usually, from visitors as far flung as Japan and Russia. The taxi driving is versatile, if not rewarding (“it helps put food on the table”) so when Wolcott gets a writing or producing gig, he stops driving and startslaunches again when the project is done.
An included incentive: he meets all kinds of characters in his taxi and has actually jotted down plenty of notes. “There may be a book in it,” Wolcott laughes.
After talking to Rosenberg, Clarke, Wolcott and King, I have actually grown even more persuaded that developing Unretirement income from the digital and sharing economies without risking your retirement savings, home equity or other limited cost savings is a heartening trend.
Chris Farrell is a Next Avenue contributor, senior economics factor for American Public Media’s Marketplace and author of the new book, Unretirement: How Infant Boomers Are Changing the Method We ThinkThink of Work, Community, and The Good Life.
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