Article 19 – Retired and wondering whether to dabble in business?

by Tan Thiam Hock

When you celebrate your 50th birthday, your friends lie to you and tell you that 50 is the new 40. It makes you feel young again. It’s a good lie filled with good intentions. That’ what friends are for anyway. Mutual denial of good times gone by and hoping to create more “feel good” days ahead.

At 50, you start evaluating your next 10 years of your life. As your kids will be going to University in a few years, you peek at your EPF and other savings and start wondering whether is it sufficient to pay for their overseas education and still have enough for a comfortable retirement.

If you are lucky, you have an asset or two that can be liquidated if ever there is a need. For most people, somehow the finances look precariously stretched and they realise that they might have to work beyond 55.

Dilemma at 55: Retirees would likely scour the newspaper for jobs, especially those who still need to work to earn an income and there are those who would consider going into business. The latter have to be prepared to run the distance.

Most companies tend to extend employment for a year upon retirement age and then you are on your own. Should you go into business then?

Many retired and retiring readers write to me saying that they want to go into business and want me to recommend a business to them.

Darn! If I were a conman, I will have tonnes of get rich schemes to recommend to them. Unfortunately, I am 52, unemployed and a bloody straight Chinaman to boot.

Being allergic to politics and politicians since young, I am honestly at a loss when it comes to advising the readers on how to make easy money. I know you must be disappointed. Please accept my apologies.

Most people continue working past the retirement age of 55 because they need to or want to. For those who have been in employment all your life, your personal balance sheet of assets and liabilities determines your level of needs. And, not to mention the requirements of your immediate family. Can you take it easy or do you still need to slog it out for a few more years?

For those already in business, there is really no retirement age. You need to continue working until your children take over, you sell out or you conk out. You can take it easier if you have a capable team running the business for you but there is no escape from the responsibilities and the commitment for the entrepreneur. It is easy to start a business but damn hard to get out of it. Be prepared to run the distance.

For those who want to continue working, money is never the motivation. Look at Tan Sri Teh Hong Piow of Public Bank Bhd. A billionaire into his 80’s, he is still actively running the bank and enjoys the adulation and admiration of his shareholders clearly seen at the bank’s Annual General Meeting. And deservingly so.

Then there are the high flyers who wants to maintain their social status quo, afraid of being left out by the “in” crowd if they stopped working. Not being seen or associated with the high and mighty would send them into a great depression.

The driven entrepreneurs will continue working and continue to build and build. That’s because they have no idea as to what to do with their life outside their business. It totally consumes their whole life because success is addictive.

Politicians who are involved in business directly or indirectly must continue working to remain in power. Power ensures membership into the “untouchables club”. Termination of membership in this exclusive club removes the invisible cloak of protection from litigations and all kinds of charges. That’s why retired politicians strive very hard to remain influential as the power brokers behind the scene. Until they feel it is safe to let go.

So should an employee become an entrepreneur when he retires from his job?

That’s really a million dollar question. His million anyway. His life savings, EPF and properties. My answer is totally idiot proof, a no brainer, pleases his wife no end and ensures his children’s education. My answer is Yes and No.

Yes, if he has spare cash to invest after putting aside the necessary funds for his retirement and children’s educational needs. Yes, if his financial investment is minimal and his new venture utilises more of his experience, contacts and knowledge. Yes, if he still has the drive and motivation.

No, if he has to risk all his family savings in a winner takes all scheme. No, if he is undertaking a totally new business which warrants a steep learning curve. At 55, his brain picks up new tricks like old dogs do very slowly.

No, if this new business requires his 24/7 attention and care. At his age, he needs time off to colour his white hair, visit his chiropractor and fit some new dentures. No, if his venture has no exit visibility till death does he part.

If you have no family business to inherit, then you should gain sufficient working experience and establish appropriate contacts in your industry before you venture out on your own.

The best age to venture into business will be late 30’s and early 40’s. Just old enough with sufficient industry knowledge and experience but young enough with the required stamina and motivation to run nonstop for the next 10 to 15 years.

However, if you intend to work till retirement and then try your luck as an entrepreneur, may I suggest you start planning now? Build your contacts and start evaluating business opportunities in the course of your work. Who knows, you might just find an ideal business that you can actually excel in.

Just remember there are no easy money projects. There are no shortcuts to success.

Advertisements