While entrepreneurs busy themselves launching their startups, they sometimes forget a crucial component: planning for retirement. It may seem unnecessary to them to start thinking about life after work, especially if their small businesses are in the early stages of growth. Time passes quickly, though, and before they know it they can find themselves with years and years of time devoted to their startup with no clear path to retirement.
This is not an unusual occurrence. According to a survey noted in a cnbc.com report, 34% of entrepreneurs don’t have a retirement savings plan. Common reasons include having insufficient income, using previous funds to start a current business and planning to sell a business to fund retirement. Another reason given by participants in the survey: having no intentions of retiring.
Most experts agree that even the most modest action taken now can grow over time and lead to a healthy retirement setup. In a column for Entrepreneur, financial investigator Pamela Yellen suggests what she calls “a safe money plan” for retirement. Aspects of such a plan include guaranteed annual growth and favorable tax treatment.
“In order to have true financial security, the numbers on your statements must be locked in and not subject to the whims of the market or economy,” Yellen writes. “You should also be able to access your money for anything you want, any time you want, without having to ask permission or sell or liquidate assets.”
A financial planner who has experience working with entrepreneurs can offer valuable advice on the types of savings and investments that would fall under the safe money plan category. You may find that your current financial situation doesn’t allow for much in the way of savings. A financial expert can look at the numbers and find an amount that, while modest, will get you started on your way to a retirement plan. As your business grows, so can your investment in your retirement.
A business adviser is another great resource for ideas on a retirement savings plan. These experts have been exactly where you are now, and they know the benefits of having a long-range plan in place. Business Advisers of Cleveland offers knowhow from successful business owners who have transitioned to helping others succeed.
As you think about the long-term success of your startup, don’t forget to consider the rewards you deserve for all of that hard work. One of those rewards should be a retirement that you can savor.