In 2008 Fortune Small Business Magazine listed Oro Valley 44th on the list of their Top 100 places to live and launch a business. Fortunately for the rest of us that love living in Northwest Pima County (and don’t really like driving south of Orange Grove or east of Oracle), many people have set up shop here over the last couple decades. Further, according to the US Small Business Administration, small businesses account for between 65 and 75 percent of jobs created. I grew up in a family landscape business that, thanks to the hard work of my mom and dad put food on the table, kept a roof over my head, and paid for my 12 years of Catholic School education for me and my sister. So, mom and dad, and every small business owner that grinds it out on a daily basis to make our lives easier, healthier and more enjoyable, thank you and Viva Small Business!
It has been my experience that small business owners are; optimistic, hard working, proactive, trustworthy, and generous people. They are inclined to put everyone else’s needs first; kids, spouses, employees, vendors etc. You name it and they are probably put in line ahead of the personal needs of the business owner.
What this often means is by the time kids are taken care of, payroll is met, new business acquired, old business serviced, bills paid, licenses applied for and kept up to date, taxes filed and paid, the business owner doesn’t have the time or energy to plan for their own retirement. But, just as it was their hard work, determination, sacrifice, risk taking and long hours that launched their business, it will also be on their shoulders to take care of funding their own retirement. In fact, according to a 2009 Guardian Life Small Business Research Institute study, 65 percent of surveyed business owners are concerned about having enough money to retire.
Like everyone, small business owners should have a formal financial plan. Part of the financial plan should include establishing and funding a small business retirement plan. Just like each business and owner is unique and have different needs, goals, and dreams, there is not a “one size fit all” retirement plan. A few of the most common plans for small businesses are; 401k, Solo-401k, SEP-IRA and SIMPLE-IRA. There are advantages and disadvantages to each and it is very important to choose one that will benefit you and your employees. If you own a business and would like to know more, send me an email and I will send you a report titled, A Retirement Plan Guide for Small Businesses. If you already have a retirement plan established, maybe it’s time to review it and see if it is still the best fit for your business. Lastly, in addition to establishing a new retirement plan or reviewing an existing one, it is also very important to plan for death, disability and retirement by making sure to have disability insurance, life insurance, and a business succession plan.
(Editor’s Note: Chan Winn is a financial advisor for Wells Fargo. He can be reached at 584-3017, or by email at Chad.firstname.lastname@example.org.)