Seniors are the new entrepreneurs

Original post by Sharon Naylor via Dispatch

A growing number of seniors are going into business for themselves. According to the Ewing Marion Foundation, 55- to 64-year-old Americans have a higher rate of entrepreneurial activity than those in the 20-to-34 age group.

Scott Shane, professor of entrepreneurial studies at Case Western Reserve University, looked at a 2009 Bureau of Labor Statistics report and found that unincorporated self-employment increases substantially with age, and “incorporated self-employment is four times higher among those ages 65 to 69 than among those ages 25 to 34, and a whopping 25 times higher than those ages 20 to 24.” Shane says, “Perhaps the older generation is more entrepreneurial, or perhaps they have more job skills and thus the confidence to go into business for themselves.”

Anita Campbell — host of “Small Business Trends Radio” and BizSugar, a social media site for small businesses — says: “Many people at age 55 and up tend to be at a stage in their lives where they can afford to pursue long-held dreams of owning a business. They’re empty-nesters and don’t have the expenses they had while raising children.”

In short, Campbell surmises that some seniors have enough financial cushion to take the risk of starting their own businesses. “On the other hand, it may be that those 55 and over are starting their own businesses due to being laid off and unable to get another job.”

According to a recent USA Today/Gallup poll, 63 percent of American adults plan to work in retirement, and two-thirds say enjoyment of work is the key reason.

Launching a startup, no matter what your financial position right now, does carry some risks. If you’re tapping into severance pay or your retirement account to launch your startup, the stakes are higher for your business to succeed. “Because at that age, you have far less time to start all over again if your startup doesn’t pan out,” says Campbell.