Starting a Business When You Retire Just Means That You Keep Working
However, the problem with viewing entrepreneurship as the Holy Grail for their sunset years is that it may not help them achieve wealth.Many are choosing a self-employment, consulting route to entrepreneurship. They gained significant expertise within some specific area, and they become a “free agent” selling their service to a variety of clients. While this can create an income flow, it is not a business model that generally creates a path to wealth.
There is often nothing to “sell” when the boomer entrepreneur really wants or needs to retire. A consulting business is tied to the activity of the owner and has no residual value that someone will be able to buy. A business has value to a buyer if it creates on-going cash flow into the future. If the boomer entrepreneur/consultant retires, the cash flow from his/her consulting activities ends.
There seems to be a myth that entrepreneurship and self-employment are secret paths to wealth. If these boomers didn’t prepare in their working years, they can start a business when they reach retirement age and it will magically create wealth. It just doesn’t work that way.
No comments yet.
Leave a Reply