Latest BMO research finds many boomers planning to work hard for a long
time at their small businesses...some until they die
TORONTO, Oct. 18 /CNW/ - According to the latest BMO Financial
Group/Ipsos Reid research, many Canadian boomer entrepreneurs have no
intention of slowing down in retirement; in fact, some plan to operate their
own business until they die.
Of those boomers who indicated they retired early to start their own
business or who plan to in the future, almost half indicated they currently
spend or plan to spend 26-40 hours a week at their businesses (48% men, 39%
women). Some boomer entrepreneurs plan on working even longer with one in
seven men (14%) saying they are/will spend more than 40 hours a week, compared
to one in ten women (10%).
Canadian boomers aren't just working long hours, they are also working a
long time into their retirement. A slightly higher number of men said they
plan to run their business "until they die" (18% vs 12% of women). One in five
boomers said they plan to run their business for more than 10 years (21%) and
almost four in ten (38%) said between 6-10 years.
"These findings are consistent with our ongoing research that clearly
indicates boomers expect to keep working into their so-called retirement
years. Indeed, many are looking at this next phase of their lives as an
opportunity to start new careers and new businesses," said Kris Vikmanis, Head
of Retirement Market, BMO Financial Group. "Every boomer has a personal view
of what retirement means to them. The key is to firm up that picture so that
they can put the appropriate plans in place to make their retirement dreams a
"Starting a business can be a risky venture," added Vikmanis.
"Entrepreneurial boomers have worked so hard over the years to save for
retirement - the last thing we want them to do is put their nest egg at risk
unnecessarily. That's why it's so important for them to be very realistic
about new business opportunities and very thorough in their planning. One of
the first things they should do before putting their retirement savings into
play is to sit down with a professional to work through the details of what
they want to do and how they plan to do it."
There are a number of reasons Canadian boomers are turning to
entrepreneurship. For many, they said it's about keeping "occupied", with 46
per cent of men selecting this as the top reason and 34 per cent of women.
This was followed by "it's something I've always dreamed" (men: 27%; women:
31%) and third on the list was "I need the money" (men: 26%; women: 25%).
Previous BMO/Ipsos Reid research found that when boomers were asked about
working after traditional retirement, 58 per cent plan on working for an
employer in some capacity and 50 per cent expect to spend some time working
for their own or family business when they retire.
In this latest research, consulting was the most popular choice of
business, with many boomer men indicating they are currently or plan to
consult in retirement (33% vs. 20% of women), while women (17%) were more
likely than men (10%) to want to start a retail business. And many of these
businesses will not be operated alone, with more than one-third of all
respondents saying their families were involved with their business or will be
in the future.
When asked what their biggest fear is when it comes to operating a small
business, almost one-quarter said "not having enough customers" (22%) and
"having enough money" (22%). Most said they are/will be financing their
business with their savings (32%), followed by loan or line of credit (19%)
and income from investments (13%). Interestingly, one in five (20%) men said
they don't have any fears, in contrast to 15 per cent of women.
According to Bob Bissett, Senior Vice-President, Personal & Commercial
Client Group, BMO Financial Group, "Starting a business in retirement isn't
significantly different than starting a business at any other life stage. The
same disciplined approach to assessing your business idea and doing the proper
due diligence apply. The key differences may lie in your time horizon to
profitability, exit strategy, tolerance for risk and source of financing."
Bissett offers five tips for boomers considering opening a business in
retirement: (i) Do your homework and make sure that you have a thorough
understanding of the industry; (ii) Formulate a business plan; (iii) Crunch
the numbers and determine how much money you'll need to get started; (iv)
Identify your customers; (v) Get the right people working for you.
For additional information and tips on starting and operating a small
business, visit www.bmo.com to access a number of BMO podcasts that touch on
key topics affecting the small business community.
BMO Financial Group and the New Retirement
Recognizing that retirement is changing for most Canadians, BMO Financial
Group is committed to helping clients understand the new issues and challenges
they face heading into retirement, while providing flexible and personalized
options for mitigating them. BMO's Retirement Your Way web site, found at:
www.bmo.com/retirementyourway, provides an overview of the new realities to
consider in the retirement planning process, supplemented with podcasts, case
studies and external resources that are updated on an ongoing basis.
These are some of the findings of a BMO poll conducted by Ipsos Reid
between October 2 and October 10, 2007. The online survey is based on a
randomly selected representative sample of 304 Boomers, aged 45 to 60,
inclusive, who have either retired early and are currently running a small
business or intend to start a small business when they retire from their
current job. With a representative sample of this size, the results among
entrepreneurs are considered accurate to within +/-5.6 percentage points, of
what they would have been had the entire adult Canadian boomer population been
For further information:
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