Video: Small Business Owners Struggle to Save for Retirement
COLUMBUS, Miss. (WCBI) – A recent study of small business owners suggest that the majority of entrepreneurs are not financially prepared for retirement.
A survey conducted by American Express found that three out of five small business owners are not on track to meet their retirement goals. Homer Beaty owns the Fashion Barn clothing store in Columbus and says saving for retirement as a business owner can be done, but it’s difficult.
“I’ve always done investments. I’ve invested in different things for myself and I always try to pay for everything before without having to make payments on it. I just try to save and pay cash and buy it when you get things. But it’s been hard, it’s always hard,” says Beaty.
Pete Creekmore has owned Rae’s Jewelry in downtown Columbus since 2000. It’s a family-run business and Creekmore says though he still needs to save more for retirement, his family will keep him afloat later in life.
“I’m planning on having my daughter and my son-in-law take over my business so hopefully they’ll just keep paying me after I retire. So that’s kind of my business plan,” says Creekmore.
Both Creekmore and Beaty suggest putting away some of your income each month towards retirement and starting as soon as possible.
“You can’t just go out and everything you make today, spend it. You’re going to have to prepare for tomorrow. So you got to be wise with what you do. You’ve got to pay your bills and got to make sure of that when they come in. But you always save part of what you make,” says Beaty.
The Small Business Administration also found that only 17 percent of business owners under 35 had Individual Retirement Accounts compared to 34 percent of those over 35.
Financial experts suggest that owners reduce their companies’ costs so that they can put more away for retirement.