A Third of Small Biz Owners Have No Plan for Retirement

A third of respondents do not have a financial plan for their retirement, while 5% said they are unsure, according to a press release. Sixty-three percent said it is “somewhat or very likely” they will have enough saved to last through their retirement, while 25% indicated it is “not very likely,” and 7% reported it is “not at all likely.”

When asked at what age they plan to retire, only 13% said before age 60, 28% said between ages 60 and 65, 18 said between ages 65 and 70, and 9% will retire past 70. Thirty percent indicated they do not plan to retire.

The press release said more than half (52%) of owners have an IRA account, and 29% have a Keogh, Solo 401(k), or a Simplified Employee Pension plan. Nearly three in four small business owners (74%) reported the recession has reduced their retirement savings, while 19% said the recession had no impact, and 6% saw their retirement savings increase.

Of those owners who say their retirement savings have gone down:

• 12% saw a decrease of up to 10%,
• 24% saw a decrease of 10% to 20%,
• 17% saw a decrease of 20% to 30%,
• 24% saw a decrease of 30% to 50%,
• 19% saw a decrease of more than 50%, and
• 5% are not sure.

Fifty-six percent of small business owners indicated they make their own investment decisions, and 35% use a financial planner or other investment professional. When asked if they have financial planning assistance through a spouse’s employer, 84% of owners said they do not, 13% said they do, and 4% are not sure.

Twenty-three percent of survey respondents said they will eventually close their businesses, 19% will transfer ownership to a family member, 13% want to sell, 6% will hire someone else to run it, and 3% are not sure. However, 36% indicated no future plans for their businesses as they do not plan to retire.