It’s no secret that the nature of retirement is changing. What used to be considered by many as a quiet, relaxing time in life, is increasingly becoming a period of greater activity.
New research from Charter Savings Bank reveals that, instead of taking it easy, millions of those approaching retirement are planning to reinvent themselves and start their own business.
The study surveyed 2,005 adults living in the UK between 11 and 15 October 2019.
These 3.5 million so-called 'pension-preneurs' across the UK have already started their own business or are planning to do so. At the same time, some want to invest in another business during their retirement.
The nationwide study reveals that 14% of over-50s have entrepreneurial plans for the years ahead.
Of these, 2.2 million people have already set up their own business or have invested in another. While a further 1.6 million are planning to do so.
Pension-preneurs collectively invest about £22 billion in their enterprises, equating to £6,300 per person over 50 years old.
15% are planning to invest more than £20,000 in their new enterprise.
The majority of the over 50s plan to use their own personal savings to fund their new business in retirement, but 11% plan to use a lump sum from their pension.
Other options for financing include loans from family and friends (8%) and business loans (7%) for their new venture.
It appears there are millions of people heading towards retirement who don't want to just stop working and put their feet up.
The most popular plan is for retirees is to volunteer with an organisation or start a charity (33%), while a fifth (22%) plan to start a new job part-time.
Setting up as a freelancer or consultant during retirement is another popular option (12%).
Paul Whitlock, Group Managing Director, Savings said: "They want to continue doing something productive with their time, whether that be working for a charity or starting a business. The fact that so many people over the age of 50 want to create a new business or invest in one is inspiring and shows such an entrepreneurial spirit."
"However, starting a business takes funds and the fact that so many people plan to use their own personal savings to do so highlights how important saving is.Whether spending one’s retirement travelling the world or starting a business, saving as much as possible from as early as possible is vital."
Professional services (13%), education (12%), hospitality & leisure (12%) and wholesale & retail (9%) are the most popular industries for pension-preneurs planning to start their own business.
Over a third (37%) bravely plan to start their new venture in a completely different industry, while almost half continue in the same industry they've worked in during their working life.
Obviously, such plans have implications on retirement planning and income options. To discuss these, contact us today.