How Boomers Become Self-Starters

After
more than 20 years in corporate jobs, Bob and Cathy Dammeyer of Dallas
had become weary of all the travel and meetings, the politics and
bureaucracy. The fiftysomething couple pondered early retirement.

"Bob bought an antique car, and I bought a pickup truck, and
we were going to see what the end of the road looked like," Mrs.
Dammeyer said.

Then reality dawned, and they figured they were too young to
retire. So they went into business for themselves, selling Swirl
frozen-drink distributorships. Three years later, the Dammeyers'
company, Culpepper Sales, does several million dollars in business
annually.

"It's rejuvenated us," Mrs. Dammeyer said. "We don't worry
about corporate minutiae anymore. We only have to satisfy ourselves."

The Dammeyers represent a growing breed of baby boomers who
have started their own businesses at a time of life when other people
have begun to think longingly about retirement.

Workers 55 and older represent one of the fastest-growing
groups of the self-employed, says consulting firm Challenger, Gray
& Christmas. The number of 55-plus Americans working for
themselves has increased 28 percent since 2000, compared with stagnant
or declining self-employment for most other age groups, according to a
Challenger analysis of government data.

Today, baby boomers and seniors account for 56 percent of the
nation's self-employed workers, the firm says.

"Boomers will use self-employment as a bridge to retirement,"
said Lynn Karoly, a senior economist with the RAND Corp.

Many boomers intend to work longer than previous generations,
but they want to work on their own terms, she said.

"They're creating jobs that give them more control over their
lives and more self-fulfillment," said Ms. Karoly, who co-wrote a
report on Americans 50 and older who have become their own boss.

Healthier situation

By the time Diane D'Agostino-Smith of Rowlett entered her
mid-50s, she was putting in 15-hour days as an oil company executive's
assistant.

"My work had taken over my life," she said. "I felt like I
couldn't even take the 30-minute exercise break my doctor had
recommended."

When her health began to slip, she knew she had to get out.
After returning to school, Ms. D'Agostino-Smith set up a life-coaching
practice to help others choose new careers.

She runs her business out of her home and values working her
own hours.

"I took a difficult situation and changed it into something
positive for myself and others," she said. "I'm proud of that."

John Challenger, chief executive officer of Challenger, Gray
& Christmas, said the corporate downsizings of recent years
have provided another impetus for elder entrepreneurship.

Older workers accept buyouts from employers, but without
traditional pensions or retiree health benefits, can't afford to
retire, he said.

"The irony is that many companies' new openness to outsourcing
and hiring independent contractors to perform certain tasks is creating
business opportunities for the self-employed," Mr. Challenger said.

Experts agree that starting a business, whether by choice or
necessity, is not for the faint of heart. The hours are long. The risks
are high. And, as some self-employed boomers have discovered, friends
may even question your sanity.

Mrs. Dammeyer advises new entrepreneurs to come up with a
short speech to deliver to doubting friends and family.

"Some people will think you're crazy," she said. "So for your
self-confidence, you've got to explain to them why this is the right
move for you."

Gene Fairbrother, a consultant for the National Association
for the Self-Employed, said the biggest challenge for many people is
deciding what kind of business to open.

Staying in one's industry reduces the risks, because the new
entrepreneur will have experience in that field and a Rolodex of
business contacts, he said.

At 50, Karen Taylor of Richardson started her own public
relations firm, Southwest Ink, after working in advertising and public
relations much of her career.

She credits her network of contacts with helping her land her
first clients.

Now 63, she says some of her business relationships date back
more than 20 years.

"My longer-term clients have become close friends," she said.

Changing course

For many of the self-employed, however, midlife becomes the
time to start over and try something entirely different.

Marika and Howard Stone, co-authors of Too Young to
Retire (Penguin, 2004), have become gurus for boomers looking for the
dream job that will carry them through the second half of life.

The couple's book, a popular text in business start-up
courses,
suggests 101 jobs for "the open-minded" -- everything from a karaoke DJ
("turn your love for people and disco music into a career and party
down") to a reunion organizer ("families and former classmates are
pulling together once again, but not everyone has the time or talent to
organize a reunion").

"This isn't a work of fiction; these are real jobs," Mr. Stone
said. "Ask yourself what you have a passion for and then go for it."

Anyone wanting to start a business needs to start with a
business plan, experts say.

"Great concepts can fail because of poor execution," said Mike
Hernandez, a past president of the Dallas chapter of SCORE, a nonprofit
group that works with the U.S. Small Business Administration. "A
business plan spells out how to turn an idea into reality."

Mr. Hernandez said SCORE's volunteer corps of retired business
executives can show prospective entrepreneurs how to write a plan.

"People often underestimate the money they'll need to get
started," he said. "As a rule of thumb, I recommend putting up 20
percent to 30 percent of the cost. Lenders reviewing a business plan
will expect that from you."

Mr. Fairbrother suggests turning to professionals for help
with
legal and tax issues. The National Association for the Self-Employed
operates a hotline (1-800-232-6273) for members with technical
questions.

When Connie Baird, 60, created a Dallas-area food brokerage
three years ago, she relied on an attorney's advice that a corporation
would be the best legal structure for her business.

She has also had an accountant handle her business taxes.

"If you don't know how to do something, hire an expert who
does," she said.

Despite the challenges of self-employment, many 50-plus
entrepreneurs say their only regret is that they didn't do it sooner.

"I may work more hours some weeks, but they're my hours," Ms.
Taylor said. "I don't have to haul a briefcase through high-rises and
garages anymore."

Health insurance costs are a shocker

The biggest surprise for many baby boomers who start their own
businesses is the high cost of health insurance.

"Coming from corporate jobs where they've had
employer-subsidized group coverage, many suffer sticker shock when they
begin shopping for health insurance for themselves," said Gene
Fairbrother, a consultant for the National Association for the
Self-Employed.

Premiums for individual policies can easily exceed $500 a
month, and that's assuming a pre-existing condition doesn't disqualify
someone.

"The best solution is to get onto a working spouse's group
policy," said Lynn Karoly, a senior economist with the RAND Corp.
"Otherwise, it's catch as catch can."

Diane D'Agostino-Smith, who started a life-coaching
consultancy
out of her Rowlett home, bought an individual policy through AARP's
"health care options" program and pays $540 a month. Before that, she
purchased coverage through the National Association for the
Self-Employed.

Bob and Cathy Dammeyer's 3-year-old frozen-drink
distributorship spends more than $6,000 a month for coverage for the
couple and their four full-time employees.

Source: The Dallas Morning
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