Are you contemplating starting a business, but you’re scared because you’re old enough to be a member of AARP? Starting a business when you’re over 50 can be intimidating, sure. But don’t let age stop you from taking the plunge into entrepreneurship.
I know what I’m talking about because I was over 50 when I started my company, GrowBiz Media, a few years ago. After writing and speaking about entrepreneurship for many years, I was excited about “walking the walk” and striking out on my own. The fact that the economy crashed just months after my business launched didn’t dampen my enthusiasm. I’ve never regretted becoming my own boss. To ensure you don’t, either, here are three things to consider before you quit your day job.
1. Are you comfortable with risk? Entrepreneurship inherently involves risk, and if worry is going to keep you up at night, running your own business may not be for you. But these days, employment can be just as risky. With the economic recovery still in its infancy, we’re not out of the woods yet when it comes to layoffs—and as many over-50s learned the hard way, Baby Boomers, with their high salaries and generous benefits, are often the first casualties when a corporation decides to slash its ranks. For many people past 50, the risks involved in piloting your own destiny pale in comparison to the worries of the work force.
2. Could you start part-time? If you’re leery to let go of steady employment, consider starting a part-time business on the side. It could be a passion you’ve always wanted to indulge (bottling and selling a family recipe, crafting artisan pottery) or it could be related to your current career. If the latter, take care that you aren’t stepping on any toes or violating any non-compete contracts with your employer. Don’t use company time, equipment or office space to run your business, and don’t take on current, former or prospective clients of your employer as your own. Review your employment agreements carefully and consult an attorney if you have any doubts.
3. What are your financial goals? Starting a business after 50 is a double-edged sword. You have probably grown accustomed to a certain standard of living; you may be responsible for a mortgage, college tuition or alimony. You’re not the lean and hungry 20-something who can crash on a buddy’s futon, subsist on a diet of Top Ramen and pour every cent back into the business. So you’ll need to be honest about what you need to make from the business—and realistic about what salary you can expect to draw in the early years. On the plus side, now that you’re older you have more sources of financing to tap into, whether that’s your 401(k) or family, friends and colleagues with the money and inclination to invest.
Starting a business after 50 isn’t a decision to make lightly, but it can be the best decision you ever make. Need more help mulling over the pros and cons? Visit the SCORE website to get matched with a mentor who can help you every step of the way.