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Planning for Retirement as an Entrepreneur

Retirement isn’t something your average person is likely to think about every day, especially if it’s not happening any time soon. However, it’s a long-term eventuality that everyone should be thinking about, no matter when you plan on retiring. If you’re in formal employment, then it’s likely that your employer deducts pensions from your pay every month. As an entrepreneur, however, that’s something that you have to commit to doing on your own. For those who are ready to take planning for retirement more seriously, here are a couple of tips on how you can do so as an entrepreneur.

Devise a Retirement Plan

Before doing anything else, the first step to take when preparing for retirement as an entrepreneur is to devise a plan. You’ve got to know exactly what you want to achieve before retirement or at least have a rough idea. When devising this plan, think about elements such as where you’re going to live and what your weekly allowance would be. This means imagining what activities you’ll be engaging in and coming up with a budget taking inflation into consideration.

Work Out the Math

Once you’ve gotten a rough idea of what your plan is, it’s time to put some meat on the skeleton. Bring out a calculator and figure out how much you’d need to earn now to fund your life after retirement. This will help keep you motivated and focused as you have long-term goals to aspire to. Additionally, you may realize that you need to diversify your income in order to reach your targets. If you need help, you can always look for a pensions calculator online.

Maximize Your Business Profits

The good thing about being an entrepreneur is that you put yourself in the position to earn far more than the average earner. Although many struggle, especially during the nascent years, there is a probability that your income could continue to see significant growth. However, in order to have decent returns you’ve got to be financially smart.

This means keeping your expenses low where possible. If you have an office space, this is likely to drain your expenses, so use platforms like Utilitywise to make sure you’re getting the best rates.

Learn More About Investing

As mentioned above, diversifying your income is typically a great move to make if you want to live a stressfree life during retirement. With that being said, start learning more about investing if you haven’t started to do so already.

If you’ve already begun investing, ensure that you spread your investments among a range of assets to increase your chances of better long-term gains. Stocks, bonds and cash are typically the best ways to invest although there are several others. As you probably know already, the earlier you start investing, the better your returns are likely to be.

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Suzi

Suzi

Editor in chief Suzi Dixon studied at Bournemouth university, went away for a while to work at The Daily Telegraph, then moved back to the sunny South coast for a quiet (er) life. Bournemouth News & Info is her website and she is assisted by the fabulous Fred From France in all things geeky and technical. Hire us to make your website, too, if you like.

1 Comment

  1. September 28, 2019 at 8:30 pm — Reply

    For the self-employed individual, these plans are relatively low cost and easy to administer. As a first step, you may want to consult with your financial advisor to determine which plan is right for you and your business. As you compare plans, consider the range of investment options and the fees associated with those investments and with managing the account. And of course, one major factor to consider is whether you need a retirement plan option that allows employees to participate if your small business is supported by a team.

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