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So You Want to Start a New Business in Retirement?

Category: Work and Volunteering

September 1, 2015 — Note: This is continuing series. See the latest installment: “The Sharing Economy Could Be Your Ticket to a Comfortable Retirement“.
Elaine (Brickhorse), a longstanding member at Topretirements, recently asked if we could write an article about working and/or starting your own business in retirement. We think it is a great topic so we have shared some thoughts about it here. Best of all, we look forward to reading the experiences, hopes, and dreams of all the great people who contribute to this website in the Comments section below.

Sure, lots of people dream about starting their own business. It sounds great: be your own boss, make lots of money, work when you want to, do something you love – there are many good reasons (or fantasies!) to be an entrepreneur. On the other hand there are plenty of negative realities to think about. This article will explore the pros and cons, as well as summarize some of the current best practices for how to go about starting your own business, large or small.

The Pros
We think there are at least 4 great reasons to start a business in retirement:

Do what you like to do. We read a survey this week that claimed that 9 out of 10 people don’t like their jobs. While we find it a little hard to believe, even if it is half that figure it is depressing. So if you are looking for a post-retirement job or to start your own business, for heavens sake pick something you like!

Make lots of money. Well, maybe. Some people have succeeded in producing good income, but they are undoubtedly in the minority. Rather a better goal might be to make enough to help maintain your pre-retirement standard of living. Or enough to justify the time and effort you put into it. Since you are in charge, you can decide whether you want to go all out, or just have fun with it.

Be your own boss. One of the main reasons why people don’t like traditional jobs is that they don’t like their boss or co-workers. So a great reason to work for yourself is you only have yourself to hate. Another plus is that you generally get to set your own hours, and how you do your work. But there are plenty of downsides too, as you can see in the Cons section.

Exciting new experiences. In your editor’s and his wife’s experience, starting a new career/business in retirement has been so enriching. We’ve met hundreds of new people, learned great skills, and had a sense of purpose. You might have the same experience, we hope!

Do not think for one moment that creating a new business is all fun, and a sure thing – it’s not! Here are some of the drawbacks:
No backup. Depending on what you decide to do, you might find yourself wishing you had someone to help out. As an entrepreneur you will find yourself as head of all of these departments: Marketing, Sales, Accounting, Bookeeping, Tax Reporting, Collections, Purchasing, and IT. When the Internet goes down, the state sends you a tax inquiry, the toilet stops working, or a customer has a problem – you are the person who is going to have to drop everything and solve the problem. Likewise if you are in a retail situation, you are the on-call backup staff for every hour you are open.
It’s lonely at the top. Are you the kind of person who thrives on human interaction? Unless you get big enough to hire employees there won’t be anyone at the water cooler (except maybe the cat) to share and work out problems. You are the boss – all by your lonesome.
Working from home can get old. Yes, it is nice to be in your PJs at 10 in the morning. But your significant other might have other ideas about you taking over the common space, telling him you are too busy to take the dog out for a walk, or to do the grocery shopping. Some people miss the ability to separate work from their play spaces.
Succeeding and making a profit. Most new businesses fail. Bloomberg says 80% fail within 18 months (see article in Further Reading below), the Census Bureau says only around 45% are around after 5 years. Businesses fail because of bad planning, inadequate finances, poor marketing and sales, inadequate contact with customers, or lack of effort. There are no guarantees that you will succeed, or that you will make anywhere near the money you expected.

5 Steps to Take Before You Start a New Business in Retirement
It is the rare person who stumbles into a successful new business in their retirement. The ones who do make it have planned carefully and followed most of the steps outlined below.

1. Brainstorm ideas
You need to take some uninterrupted time to consider all the possibilities for your new business. You might want to do it on a long airplane flight or at a retreat. The process requires quiet thinking. Here are some of the questions you need to answer:
– What do you like to do, and what are you good at? What kind of product or service could you create in those arenas? Is there something creative you could do, like becoming a writer or artist?
– What un-served needs are there in the marketplace or your community?
– Have you seen a product or service succeed in another community that is not available in yours?
– Is there something you could do on the Internet that might turn into a business?

2. Survey the competition and talk with potential customers
You can learn so much from the competition and from your customers. How difficult is what your competitors are doing? Are their hours reasonable, are they thriving or just surviving, could you do what they are doing better? Is there room for a new competitor? You can go online and find out a lot if you search. Talk to customers and see what they are looking for. Visit stores and places of business, read comments and feedback online. If what you want to do is in the arts, how do successful writers, artists, etc. get published and sold? There is usually a lot of spade work to be done on the road to success.

3. Write out a plan
There is no substitute for creating a well-thought out business plan. You can find samples online. The objective is to have a document that clearly states what you are doing to do, how you are going to do it, and what your goals are over time. Pretend you are preparing a document for an outside investor – would you invest your money in the business you are describing? Businesses require systems and infrastructure – how are you going to provide those? It is the process of writing the plan that is important – by thinking through each step you do the hard work of examining options, discarding those that don’t make sense, and making what you think are the best decisions.

4. Set goals and measure your performance early on
Goals and measurements against them will be your reality check. If your new business isn’t working out as planned, early intervention gives you time to try something else. It can also tell you to pull the chute if nothing seems to work. Better to know this earlier than later. But one of the biggest advantages of tracking how you are doing is that you can change things up. It is the rare business that works exactly as it is supposed to – the hallmark of success is the ability to change in the face of the unexpected.

5. Have an exit plan
What, you want me to think about leaving before you get started? It does seem a little backwards, but it won’t hurt to think ahead a little bit. What will you do if you don’t meet your goals – at what point, and how, will you extract yourself (more complicated if you have repeat customers who count on you). On the other hand, what happens if you go down the road 15 or 20 years and the business is doing well? What will your exit strategy be? If it is to sell the business or turn it over to your children or employees, it would be good to have at least thought about that ahead of time so you could prepare.

Kinds of businesses and jobs – coming up next
We are hoping that our Members will help fill in the blanks about the types of retirement jobs, careers, and businesses that you have started in retirement – full or part time. Where did you find work? Did this impact your pension or taxes? Please share your success stories, what you could have done to avoid your failures, what was great and not so great about the experience, in the Comments section below. We will use your Comments, if we get enough, to write a follow up article.

Bottom Line
These are just some basic pieces of advice about starting your own business. There are tons of good books and articles to help you in the process. Read those, and talk with as many people as you can. Anybody who has their own business, whether it is related to yours or not, probably has some good advice, won at some cost, to share with you.

For further reading
The Sharing Economy Could Be Your Ticket to a Comfortable Retirement
8 Good Reasons to Be Your Own Boss After 50
8 Reasons Not to Start a Business in Retirement
5 Dream Jobs for Your Retirement (there are links to more articles about retirement jobs in this one)
Topretirements Members Very Confident About Their Retirements
5 Reasons 8 Out of 10 Businesses Fail

Posted by Admin on August 31st, 2015


  1. Can’t say I have a job but I make a little money on Ebay selling Hub’s tools he no longer needs and household items. I used to sell stuff on Ebay when I was working too. It is easy to do but can cause clutter unless you plan on where to stage the things you need to list and the things you have listed. It can get a bit confusing if you have a lot of items listed at the same time if you are not organized. If you should pursue this, you can get free shipping boxes, envelopes of various sizes through USPS on line. The Post Office itself doesn’t have all the sizes available. So you need to order them on line. They will send you everything for free and will not charge you any shipping charges. So it is fairly inexpensive to set up a ‘business’ with Ebay. You will need to buy a scale to weigh your packages. USPS has those too or you can buy them where ever you can find a scale. I have a Weight Watchers kitchen scale that is accurate for smaller packages. I learned how to do Ebay years ago from my buddy I used to work with. He always said he wished he could find one thing he could sell over and over again that was cheap to mail using a regular envelope and a regular stamp. He never did find that small item as far as I know! If you take a look at Ebay you will find tons of niches of ideas to sell things. If you don’t have household items to sell, a lot of people go to Thrift stores and find interesting items to resell on Ebay. Another place to sell vintage and craft items is Etsy. I have listed things on there too. It is very easy to do.

    by Louise — September 1, 2015

  2. Be sure you have the 4 Ps: Passion (you love what you’re doing), a Plan (discussed above); Persistence (stick with it; not only when you’re establishing yourself, but be sure to devote time each day to your business), and People (you’ll have to have an audience for your business – people who want/need what you’re selling). I’ve been my own boss since 2004, and love it.

    Jan Cullinane, retirement author/speaker/consultant

    by Jan Cullinane — September 1, 2015

  3. We are posting Elaine’s original suggestion here, which actually requested some additional info we didn’t cover yet. We encourage our Members to help out with the rest and will include in the followup article:

    I will have to work part-time into my 70s. Do other retirees who read your articles have to work part-time? What kinds of jobs are available, that aren’t grunt work for minimum wage? Do you have ideas on finding work? What about professionals who may want to continue in their field, or, translate abilities and skills for another field of work? Statistics on working retirees? Any success stories or stories about what didn’t work out? Effects on Social Security, pensions, etc.?

    by Admin — September 2, 2015

  4. When I retired, I established my own business with my primary woodworking hobby. The outlook honestly was not good, but I knew I would at least enjoy it. I dedicated 5 years to trying to make the business successful and had some critical success, but never made a profit. The time invested was tremendous — 10 or more hours a day. As is needed with any business, the time required for inventory management, bookkeeping, sales and a little marketing finally overwhelmed my practical work and that’s when I decided to “retire” again and formally closed the business.

    I have no regrets — I developed skills and obtained needed tools that otherwise I would not have. Likely the lack of marketing had the biggest impact on my lack of success, but I decided early to sacrifice marketing time for “work” time. (By the way, I funneled all formal aspects of the business through a CPA — the security of doing it right was worth the several hundreds of dollars a year.)

    by Rich — September 2, 2015

  5. Rich,

    Sorry the Woodworking business didn’t work out for you. Owning your own business is not easy for sure!

    I have no idea what kind of wood objects you made but have you ever considered writing a step by step instruction book on how to make for example a table, bench, shelf? You could put together little manuals and sell them as PDF’s on With that format you never have to ship anything. The customer just downloads the PDF after they pay for it.

    Also, with your expertise you might consider teaching an adult education program. I have seen in my local Adult Ed brochure that they encourage people with talents of all sorts to teach all kinds of subject matter and it can be taught off site from the school. In our area there is a Nursery that is teaching things about planting trees, shrubs and flowers. Kind of a landscape course. Another person teaches stained glass and it is out of her studio. I could imagine a lot of people would be interested in a woodworking course and they could take home a small project made in your shop. In our town they have Adult Ed courses in the spring and fall. Maybe you could contact some technical schools that teach woodworking and you could get a part time job teaching!

    Not trying to get you out of retirement! Just some thoughts if you wanted to share your expertise with others!

    by Louise — September 2, 2015

  6. If you are interested in an online business check out Site Build It. They have a total system and all the tools to get you started. Very reasonable price.

    by Gary Griffith — September 2, 2015

  7. Louise, thank you for your thoughts, but you have it right — I really don’t want to un-retire again. I have way more than enough on my plate to keep me busy and happy. Retirement has been a fascinating lifestyle for my wife and myself — full of challenges and lots of activities. That also contributed to my decision to close my business.

    My purpose in responding about after retirement business was to point out that no matter how enjoyable or how much work you put into it, as the article indicates, success is a crap shoot. I wanted to do something I had never done — open my own business and to fully utilize and develop my hobby skills as a professional. That part worked. Making money was a hopeful but not essential consideration. (Though in those early years, there was a lot of emphasis on the “hope” part.)

    Since I had legally established a formal business, I felt using a CPA was a reasonable safety net and felt that was also worth pointing out.


    by Rich — September 2, 2015

  8. Reading articles in, say Money Magazine (not here, of course!) always press my “Warm” button. I’m not passionate enough about the topic to have my ‘hot’ button affected, but i am concerned. The vast majority of small businesses in America fail. The statistics are very high (i’m not sure of the number but i think 80% or higher). So why do articles inform us of the few who have made it? Encouraging a dream is one thing, misleading others is something else.

    by ella — September 3, 2015

  9. After retiring from the corporate world I dabbled into many things, guitar, making cheese, roasting coffee, brewing beer, among some interests. A friend also roasted their own coffee, and we started giving out samples to friends. After getting positive responses, we decided to start a small company selling roasted coffee beans. Since he was still working full time, his wife jumped in as a partner, so they owned 50% and I did too. We invested a modest amount into the business, less than $2000 each and incorporated with the state. I had a building behind my house that we used as our roasting shop. We had to jump through hoops to get a health permit from the county but succeeded.

    We started selling at farmer’s markets, and various local shows. We gained a faithful following of customers who would reorder. We reinvested our profits into various equipment, including a larger 12 pound roaster, and even a used mini-van. We never added another dime beyond our initial investment. We grew to the point that we were wholesaling coffee to a grocery chain, and many businesses, like markets, B&Bs, and coffee shops.

    All this took place in a three year period. We were actually profitable at this point, but we were not pulling a salary yet, just building equity. A lot of hours were spent doing bookwork, roasting and bagging, delivering, etc. but it was something that I enjoyed doing, even though I was doing a lot of the work. One thing I did learn was that when you have a business like this, you can not take time off to travel. In this period, I got married and priorities changed. I ended up selling my half of the business to my partners, as we wanted to travel and become snowbirds. After a year, my partners decided to sell the business. Another guy ended up buying it and is doing very well today with it. He has expanded it into a coffee shop and larger coffee roasting business.

    I have great memories of building this business from scratch and made a little money in the end. I am now back to roasting my own coffee as a hobby!

    by Bill — September 3, 2015

  10. When I think of a small business for myself, I think of doing work that is in line with my “what I want to do when I retire” list, and that costs little or no money to initiate. I’m probably thinking more of being an independent contractor providing a service rather than providing a product – although products from writing are desirable. My list includes writing (and the other literary arts and skills), working with animals (even people with horses like to travel and need someone who knows livestock to feed or housesit, plus I can walk a dog and feed a cat), being around people from other countries (from renting a room to a grad student to tutoring at the university), and being in the academic field (consulting for accreditation, writing grants, substitute teaching/librarianship, and doing research in a variety of disciplines).

    I like the coffee bean roasting idea, even though it’s not for me, because it started small and was fun, continued at a reasonable level, and then became an enterprise that was profitable enough to be a successful buyout. Bill continues to roast his own coffee as a hobby, which indicates to me he didn’t sour at his small biz experience.

    Maybe what I want isn’t really to start my own business, but to find niches for current skills that lead to earnings for what I want to include in my life in retirement for physical, mental, emotional, and spiritual fulfillment. I’ve invested in myself all my life, so maybe I’m the product to market. I’ll still get a tax number, I’ll still develop a business plan, I’ll still market myself, and I’ll still pay taxes. Does this sound realistic? I think so. Maybe as I’m selling fruits and vegetables at the local farmer’s market, I’ll be keeping all the cage free eggs out of just one basket.

    I haven’t retired yet, so I don’t know how realistic the above is. Yet, I figure the more I have to offer, the greater the opportunities for success.

    by Elaine C. — September 4, 2015

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