It’s risky to use retirement capital to start a business

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By Personal Finance 

There are essentially two types of people who would consider using their retirement savings to start or buy a small business: youngish people with an entrepreneurial spirit who want to escape the corporate world, perhaps with an innovative idea on which to base an enterprise; and older people who are approaching or at retirement age, who do not have enough savings to sustain them in retirement and need a source of income.

For the former, the risks are relatively small; for the latter, the risks are huge. Put another way, the longer you have been saving and the more of those savings you plough into a business, the higher the chances of your spending your final years in penury.

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