Merrill Lynch has a great webcast called Reinventing Retirement: Second Acts, recorded in June 2010. It profiles over-age-55 people who are starting businesses. Every Baby Boomer should watch it. I coach corporate executives who want to start businesses as encore careers. This webcast illustrates many of the key points I coach potential entrepreneurs to consider.
One very important point the webcast addresses is that some people start businesses because they have been downsized and can't find a job. That's a predicament that's hard for anyone to deal with and even worse for older people.
Sally Krawchek, president of global wealth & investment management for Bank of America Corp., makes an essential point in response to ABC's Charles Gibson's statement that "you need to save, you need to have a nest egg. And then we see a lot of people saying, well I'm going to take that nest egg, and I'm going to roll the dice, and I'm going to invest it in a this or a that or an other ... So, yeah they save, but then we say to them, given the new realities, we want you out there rolling the dice with that nest egg."
Here's what Krawchek says to Gibson (which I edited slightly for clarity): "How about, I have a nest egg. I have investments that will provide me with some stable income that I can live a nice life on, and I'm going to take some risk here, and then my spouse is going to continue to work part-time in this job here. You continue on that plan, and then after three years you say, this part is working, this part is changing, this part did better than I think. It's a continuous process of taking the temperature, taking the check and readjusting the plan."
Krawcheck is noting the different between taking risks, and putting yourself at risk.It's the most important point for over-55 would-be business owners to consider.
Some people are running so fast from unhappiness and discouragement in the work force that they grasp onto a business idea and throw their remaining resources (like their 401k) into a new venture. With no backstop. Yes, people do it every day and we often hear about amazing successes. Like we read about Powerball winners. With about the same odds.
Do you agree there's a difference between taking a risk and putting yourself at risk when starting a business? What have you learned? Please share a comment.
Oh so true but also as a baby boomer who lost pension, it is essential to keep working and since no one hires us, entrepreneurship is the only alternative. More importantly though we know how to get things done
Somepeople are forced out of jobs because of age and then join entrpreneurship because they do need money and have to keep up with inflation.