Four out of 10 people in business for themselves are older than 50, AARP data shows. This as the number of older people who are self-employed has been inching up for several years, even as the overall number of self-employed Americans has declined, according to StartupJournal.com.
Examining the numbers behind a startup business shows why this option may be so attractive to those contemplating retirement. According to the AARP study, the self-employed have higher household incomes and financial wealth than their wage and salary counterparts. Among those age 51 and older, financial wealth averages about $740,000 among the self-employed, compared with $240,000 for wage and salary workers. At the median, the contrast is for the self-employed-$312,000 compared with $119,000 for wage and salary workers.
At the same time though, t he self-employed are less likely to have employer-provided health insurance than their wage and salary counterparts. Among self-employed workers age 51 and older, 34% have employer-provided health insurance compared with 67% of wage and salary workers of the same age.
“The growing number of self-employed older people is being propelled by the number of Baby Boomers heading into retirement,” says Tony Lee, editor in chief of StartupJournal.com. “Older workers may be attracted to self- employment as a transition to retirement or to supplement retirement income.”