I’ve mentioned before how Keith and I schedule time every year to talk about our life. We discuss our business, personal stuff, and finances. One of the reasons that we started doing this is because we own a company, ITM Group. We thought it was important to talk about what our retirement would look like as entrepreneurs.
Freelancing, contracting, consulting or entrepreneurship…whatever you want to call it, is far more popular today than it was almost 20 years ago when we started our company. Many individuals have side hustles in addition to regular full-time or part-time jobs. Which is why it’s so important to think about retirement (and unretirement) in the context of both regular work and freelance work. Because the transition could be different.
That’s not to say that the transition would be bad or difficult. Frankly, having a side gig while transitioning to retirement could be fantastic. It could offer a huge about of flexibility while at the same time provide some financial security.
In the book, “Your Next Adventure: Planning for Life After the Sale of Your Business”, the authors take the time to talk about five elements to consider when you have a business and you’re planning entrepreneurship in retirement. And as a side note: if you’re saying to yourself “I’m not really a business owner. I just do some speaking on the side. Make a few bucks each year.” Let me tell you – you’re a business. And you need to think about how you will manage that freelancing work during your unretirement journey. Here are the five elements to consider:
- Your social circles. When you own your own business or you have a side gig, you spend time networking and building relationships. At the point you start transitioning away from work, your social circles are going to change. Maybe not completely, but they will change. Are you ready to transition those friendships and build new ones?
- Your family. Making the decision to work less, sell the business, or transition to doing different work is one that is best discussed with family and close friends. Especially if you have family members or really close friends who help out in the business. Keeping them out of the loop could create some unfortunate surprises.
- Your purpose. As a consultant, I spend a lot of time working. And I’m okay with that. But I’ve always been a person who likes a full plate. I honestly have no clue how I would spend my time if I was a full-time retiree. And it scares me a little. At some point, I will need to figure out how to provide purpose without owning a business.
- Your wellbeing. A contributing factor to entrepreneurship is being physically and emotionally well. There are often long hours and sometimes sleepless nights. The last thing that anyone wants is for our failing health to drive our retirement plans. Finding time to take care of ourselves is important.
- Your finances. Last and certainly not least, we have to think about our financial position. When you work on your own, there’s no pension plan. You have to finance your own retirement. Individuals will want to start planning for how their finances will be changing as the nature of their work changes.
I think these five elements are great topics to keep in mind as you’re planning your transition toward retirement. Even if you don’t own a business or have a side hustle. But of course, we’re talking about entrepreneurship today.
Even though the book didn’t mention it, that was one of the big takeaways for me. The things we need to consider for our transition to retirement are very similar regardless of our employment status.
Image captured by Sharlyn Lauby while exploring the streets of Chicago, IL