TORONTO, ONTARIO--(Marketwire - Oct. 17, 2012) - As part of BMO Financial Group's ongoing commitment to financial literacy and 'Making Money Make Sense' for Canadians, BMO is releasing a financial tip every week in 2012.
BMO's Financial Tip of the Week: "Boomerpreneurs" - Consider the financial implications before you become your own boss.
"Boomerpreneurship" is becoming a notable trend, especially as a large number of Canadian boomers are expected to retire in the next five years. Many retirees plan to use retirement as an opportunity to start a business.
According to Industry Canada, the overall number of self employed workers has increased by 17 per cent the past decade, and 40 per cent of workers older than 65 years are now self-employed.
"There are many benefits to opening a small business during your retirement years; however, aspiring 'Boomerpreneurs' should be mindful of the large financial commitment running your own business can entail. Also, a lack of sufficient preparation can have significant negative effects on a business owner," said Joe Collura, Small Business Area Manager, BMO Bank of Montreal.
Entrepreneurship can be appealing for a variety of reasons, but it's important to consider all of the financial implications involved before you take the leap into self-employment.
As Small Business Week is underway in Canada, BMO offers the following advice for prospective 'Boomerpreneurs':
Do your homework - Take advantage of the resources and business networks you have built over the years and learn all you need to know and do to set up your company. This includes gathering relevant industry insight, arranging a new phone number, deciding whether or not to incorporate the business and looking into the potential tax implications.
Weigh the pros and cons - Think carefully about why you want to start your own business. Being your own boss can provide lifestyle flexibility; however, longer hours and a possible decrease in cash flow - both when you start up and, potentially, over the life of your retirement - may be necessary to ensure your success.
Create a business plan - Stress-test your idea and research your marketplace, including what products and services you will offer, the appropriate price point(s), who your potential customers will be and what your sales targets will need to be to cover your costs. Keep your end goal in mind as you build your company and maintain a positive - yet realistic - outlook as you progress.
Seek professional advice - Speak to an accountant and a small business banker - financial specialists who can provide insight into setting up your company, market competition and personal and business capital needs.
For more information on starting a small business, visit a local BMO branch or bmo.com.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly-diversified North American financial services organization. With total assets of $542 billion as at July 31, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.