Is it a good idea to become an entrepreneur after 50? WEMU’s Lisa Barry and Dr. Theresa Reiddiscuss the pros and cons of creating your own company or community at a later age and share resources on how to make that happen in this edition of "Modern Aging."
Is it a good idea to become an entrepreneur after 50?
On the one hand, there’s a lot of Rah-Rah in favor of senior entrepreneurs these days. On the other hand, there’s the ageist assumption that entrepreneurship is a young person’s game, that olders are not creative or energetic or visionary enough to be entrepreneurs – the “Gloom and Doom” scenario.
Reality:
- The highest rate of entrepreneurship worldwide - not just in America, where 34 million seniors want to start a business - has shifted to the 55–64 age group. Entrepreneurial activity among the over 50s increased by more than 50% since 2008.
- Entrepreneurs over 50 are almost twice as likely to found successful companies than those between 20 and 34. GEM (Global Entrepreneurship Monitor)
Reasons:
- Creativity often increases with age.
- Older people bring “the experience dividend,” plus know-how, networks, and financial capital – i.e., money.
- “Experieneurship” – Global Institute for Experienced Entrepreneurship
So should you run out and start that business you’ve always dreamed of owning?
Pros:
- Fulfilling a dream.
- Meeting a need, filling a niche.
- Setting your own schedule.
- Being your own boss.
- Hopefully, earning a living.
Cons (specifically for older entrepreneurs):
- No matter how old you are, entrepreneurship is HARD. Researching the market, researching how to deliver your product or service, business planning, networking tirelessly, promoting (using social media) tirelessly, managing all the finances, weathering ups and downs.
- No benefits – sick leave, vacation, health insurance, savings – that don’t come out of your own hide.
- Timing is everything – not just market timing for your idea, but financial timing: If you start before you’re eligible for Medicaid and Social Security benefits, you have more expenses and more exposure than if you start later. Not an absolute barrier, but an important factor to take into account. If you start later, when you’re eligible for Medicaid, well – then it’s later! You have a shorter runway and more uncertainty regarding your health.
Final analysis:
- Neither the Rah Rah scenario or the Gloom-and-Doom scenario tells the whole story.
- Lots of seniors are successfully starting businesses – again, with twice the overall success rate of the cohort half their age.
- BUT – it’s not for everyone: Look before you leap. ;)
Resources:
WCC’s Center for Entrepreneurship– accessible, affordable (free for 65+)
“5 Pitfalls of Starting a Business in Retirement”
“10 Tips for ‘Senior’ Entrepreneurs"
“Boom” – a great video from PBS NewsHour about “senior entrepreneurs”
Global Institute for Experienced Entrepreneurship – dedicated to keeping or returning experience of older people to the workforce
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— Lisa Barry is the host of All Things Considered on WEMU. You can contact Lisa at 734.487.3363, on Twitter @LisaWEMU, or email her at lbarryma@emich.edu
