More small-business owners plan to retire at an older age–fewer plan to retire at a younger age. This is the current state of affairs after the economic downturn, according to the Wells Fargo/Gallup Small Business Index, surveyed in July 2010. Sixty-nine percent of business owners are not planning to retire or cut back on work until age 65 or older. This is a 17 percentage point increase from December 2007 and a 28 percentage point increase from September 2005. Conversely, respondents planning to retire earlier than full retirement age (between ages 60 and 64) decreased to 21% from 27%. And retiring before age 60? Only 11% are still holding on to that dream.
“Many business owners are reinventing their business approaches in order to ensure financial stability for the long-run,” said Doug Case, Wells Fargo small business segment manager. “This often has a direct impact on personal retirement plans and tests the resilience and entrepreneurial flexibility which characterize small business ownership.”
Small-business owners are adaptive people and 62% of them have made changes to their retirement plans since the economic downturn, Wells Fargo said. Yet 68% are still worried that they will not be able to recoup the losses their 401(k)s suffered in the recession. Likewise, fewer respondents, 63% as opposed to 79% in 2007, were confident that they will have enough money to live comfortably when they retire.
And then there are those small-business owners who do cannot imagine life without their work. Forty-seven percent of respondents reported they never plan to retire unless forced to do so for health reasons, an increase from 40% reported in December 2007. The majority of survey respondents, however, look at retirement as a time to work at something they enjoy doing, on their own terms.