Small business owners are not financially prepared for retirement

Throughout the recession, most Americans have focused on the day-to-day: paying their rent or mortgage, car or student loans, medical care; and buying necessities such as groceries and clothing. However, there is growing concern among economists and financial analysts that Americans are not saving enough money for retirement.

With the uncertainty of the federal Social Security problem, retirement plans are something that people in Georgia and throughout the country need to make a priority. But when money is tight, it is only natural that people will divert the money they would put towards retirement to daily necessities. This practice may result in later retirement, greater dependence on welfare programs, and an increased number of bankruptcy filings among retirees.

For small business owners, this is nothing new. According to a recent study, approximately two-thirds of small business owners believe they will outlive their retirement funds, and one-third already plan to work past standard retirement age and into their 70s.

The survey, which was conducted by Guardian Life Small Business Research Institute, polled approximately 1,400 small business owners to determine their feelings on their preparedness for retirement. Less than half of the respondents reported that they feel fairly or very well prepared for retirement, and 10 percent reported that they plan to work full-time past age 65. An additional 14 percent plan to work at least part-time, and 39 percent plan to toggle between periods of work and periods of leisure.

While working into retirement may be unavoidable for many small business owners, the survey is a wake-up call for workers in any setting to make retirement plans a priority. If you are unable to do so because of unmanageable debt, a bankruptcy attorney or other financial professional may be able to help.

Source: Atlanta Journal-Constitution, “Small business owners are unprepared for retirement,” Henry Unger, 17 June 2011