More Seniors Start Businesses In Recession

It’s a great time to start a small business, and many people are doing just that.  A recent report from the Bureau of Labor Statistics (as reported by a NYTimes small business blog) shows that small business start-ups have increased between December 2008 and April 2009.

Why the Increase in Start-ups? It’s not surprising that more people are starting new businesses.  If you get laid off, don’t want to move, and have some expertise, it’s likely that you would consider staying where you are and finding a business you can start or buy or you can search for a franchise.

Increase in Start-ups for Over-65 Age Group. What’s most interesting about this report is the significant increase in start-ups for individuals in the over-65 age group. You would think over-65’s are ready to take it easy and enjoy retirement.  But this information bears out the opinion of many that older people are not counting on retirement savings any more.  Starting a business can bring in enough income to help the person avoid taking social security payments, which will increase that benefit when it starts later.  Seniors also have Medicare so they don’t have to worry about health care coverage for their busienss.

What kinds of Businesses? Older people start different kinds of businesses than younger ones.  From my experience and my proximity to this age group (I’m over 60), I would hazard a guess about the kinds of businesses Over-65’s start.

• Senior Services. Seniors are likely to find and start businesses that help other older seniors.  For example, someone 65 might want to start a senior transportation service, helping elderly people get to doctor visits, the grocery store, and activities.
• Online Businesses. Many seniors are tech-savvy and if they are more likely to work on the Internet than, say, businesses requiring physical labor.
• Hobby Businesses. By the time someone is 65, he or she may have a hobby, and turning a hobby into a business is a great idea, as long as it is put together to be a real business to avoid IRS issues. Crafts and recreations are good businesses and they certainly make the work fun.
• Experience-based Businesses. The expertise from a lifetime of work can be put into a business, either a new product or a service.

With their many years of experience and enthusiasm and, of course, a nest egg to put into a business, can find enjoyment and a source of income to keep them going for many more years.

Image: victorward@sxc.hu