Have The Right Amount Of Capital
Retiring requires a certain amount of financial stability, and this especially rings true when starting a business after you have retired. Ensuring that your business model can be sustained on your retirement savings is crucial in successfully launching, and being able to still comfortably live. The most effective rule to follow is the four percent rule; if you withdraw and live off of 4% of your overall retirement fund per year, you’ll be comfortable and able to support your lifestyle with the available funds. The funding for your business should be included within this 4%, until you start to bring in a profit, which is typically between two to three years.
So ideally, if your total savings is $500 000, then a withdrawal of $20 000 annually will be your available income for both your business and your living expenses. Other streams of income can be especially beneficial when starting up a business after retirement, particularly passive income and investments that will help financially and add to your retirement funds, such as investment properties and stocks, and help the new business flourish.
Capitalize On Available Resources
One of the best advantages of starting a business after retirement is the wealth of knowledge and experience you will have undoubtedly acquired throughout your career. Being able to bring this experience to your own passion project is the primary driving force behind starting up a business at this stage in life, and why so many are so successful at it. For many, getting away from the corporate 9-5 and being able to work remotely and from home on their business is crucial. Investing in the right laptop and technology to run your business is the most important aspect.
Being able to communicate with your team and clients effectively requires the ability to run professional meetings and conferences remotely, so the right technology needs to be used. One of the many perks of working remotely is the freedom to hire freelancers for many roles that would have traditionally required staff members, such as admin, secretarial, marketing, and accounting. Finding the right people on sites such as Fiverr or Upwork allow you to cut further costs in your business, and stay location independent.
Starting a new business after retirement is more attainable than ever. Having the right business plan, finances, and access to technology are all key to starting a successful business that will allow you to work remotely and on your own terms.
Thanks to Jackie for this contribution
Check out Visiple´s easy to use tools to help you communicate