With so many young entrepreneurs making their mark in the business world, it can be easy to forget exactly how many successful business owners there are from the older generation.
The State of Boomer-Owned Small Business
Millennials along with Generation X and Z can still learn a thing or two from the Baby Boomers, with 1 in 3 Americans relying on income from a Boomer-owned business. But with 10,000 Boomers retiring every day, the question is what happens to their businesses once the Boomers retire?
MBA Stack, which provides helpful and accurate information to current and prospective MBA students, has teamed together with infographic design agency NowSourcing to create a guide to Boomer-owned businesses. The findings of MBA Stack reveal that such businesses are currently thriving in the United States, with Baby Boomers accounting for 40% of small businesses and franchise ownership.
However, the clock is ticking as retirement looms for many. Let’s look closer at the state of Boomer-owned businesses and what happens after they retire.
What’s Next for Business-Owning Boomers
The stats show that three-quarters of Boomer business owners don’t actually have a plan for retirement as they still enjoy running their businesses. The data also reveals that many business owners will need to sell their businesses in order to fund their retirement, with 45% of Boomers having no savings.
The need to sell could be exacerbated by a decrease in younger generations wanting to take over the family business. Millennials, for example, are less likely to want to take over a family business because they have a wider array of career choices than their parents did.
Investing in Boomer-Owned Businesses
If the Millennial in the family doesn’t want to take the reins, it is quite likely to be another from that generation who offers to buy the business. Millennials are increasingly leaving corporate jobs to become their own boss, and buying an established business may be the better option for them. Boomer-owned businesses are attractive options as they are already profitable and will likely have a strong local brand and connection with customers.
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If you’ve set up the business to run without you actively participating in day-to-day operations, then it makes sense to keep the business and its income far into retirement.
Most people don’t realize that the “Boomer” generation have a lot of money! Their businesses they have built have been around for decades, and the small businesses especially have a lot of room to grow. Good investments I say! Great article Gabrielle.