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Starting a business at 50

The UK’s self-employed population grew 47% between 2001 and 2017.

The increase is even more pronounced for over 45s. The number of them in self-employment grew 65% from 1.7 million to 2.8 million over the same period.

Why are so many older people deciding to strike out on their own? What are the best businesses to start and is there any help available?

A lady planting shoots in a polytunnel.

A new challenge

We’ve all fantasised about a career change at least once, but for some the lure of starting a new business is irresistible. Even in the same or a similar industry, running a business yourself poses new challenges that many find stimulating and rewarding.

Over a career we accrue lots of knowledge and wisdom, business acumen, and – understandably – many want to channel this into their own business ventures instead of working for someone else.

It’s the experience that can help a start-up to flourish. There are always transferable skills and learning from mistakes that will help you steer a new business in the right direction.

Control and flexibility

Obviously running your own business can offer a lot more autonomy and control than working a job for an employer.

Maybe that means stepping back and letting someone else manage the business, or just choosing days, times and workplaces that suit your other commitments. When it’s your business; it’s your call.

This is why starting your own business can be a good part of a plan to semi-retire abroad, or to make time available to look after relatives or simply work from home.

Following a passion

Many of us have passions. Maybe it’s a lifelong hobby, an unaccomplished goal or something we discovered during adult life. We owe it to ourselves to pursue our passions.

At 50 some people decide it’s time to pursue their interests, even if it means some financial uncertainty and abandoning a stable career.

It’s a way to invest for the future

Setting up a business can be costly. It might be easy to do digital work from a laptop but many businesses require premises, staff, stock, insurance and much more. Why are older people more likely to do it?

Older people are more likely to be in a healthy enough financial situation to re-invest savings and generate an income. Financial commitments such as mortgages tend to be coming to an end, they may receive redundancy payments from a previous job, inheritance, savings or pension freedoms to help.

Fewer older entrepreneurs require a bank loan and those that do are more likely to be accepted. Generally due to having a better credit rating, more security and sometimes even a better thought-out business plan.

How to set up your own business

If you want to set up your own business, here’s some ways you could consider paying for it:

  • A government start-up loan
  • Borrow against your home (if the mortgage is paid, this puts your property at risk)
  • Release equity from your home
  • Release money from your pension using your pension freedoms
  • Borrow against your pension
  • Become a buy-to-let landlord
  • Bank loan
  • Alternative finance like peer-to-peer loans

PRIME is a branch of the Prince's Trust that specialises in support for over 50s who want to start a business.

Note: We take care to ensure Talking Finance content is accurate at the time of publication. Individual circumstances can differ so please don’t rely on it when making financial decisions.