Retirement Insights

News and information for current and future retirees.

7 Major Mistakes Made By Retirees Looking To Start A Side Hustle

You’ve got the time. You’ve got the desire. And you’ve got a few extra bucks to spend. Starting a business in retirement sounds like a piece of cake.

If you want to know these traps before you fall into them, take a look at what these entrepreneurs reveal about the mistakes retirees most often make when starting a new business.

Mistake #1: Taking too much risk

This is a big one. It’s the most misunderstood aspect of starting a new business. Entrepreneurs don’t take risks; they take calculated risks. Quite frankly, you don’t have the runway length to land safely if you place too big a bet in your retirement years.

“The worst thing a 50+ person interested in a small side business can do is to take too much risk, particularly for something they are unprepared for,” says James Connolly, Co-Founder and CEO of Villa Homes in San Francisco. “It’s important to continue investing for retirement (at 50, or even 60 or 70, there’s still hopefully a long-time horizon ahead) while having an appropriate margin of safety to protect savings.”

It’s probably a good idea to think of starting a new business at this stage in your life as a gamble. It doesn’t mean you won’t be successful. There are plenty of examples of successful entrepreneurs who started new businesses in their 50s, 60s or even their 70s. Nonetheless, you should treat this the same way you do when you enter a casino. Know how much money you can afford to lose and pull the plug once you hit that mark.

“One thing you must not do is risk your retirement nest egg on risky business ventures,” says Lamar Brabham, CEO and Founder of Noel Taylor Agency in North Myrtle Beach, South Carolina. “By definition, all business ventures carry a certain amount of risk. Don’t ever risk more than you are willing to lose. Most small businesses fail, and you don’t want to ‘have’ to go back to work because things didn’t work out. Plan for the worst and hope for the best.”

Mistake #2: Choosing a business you have no experience in

Speaking of money, one of the biggest start-up gimmicks is to convince naïve entrepreneur wannabes to “buy” a preformatted business template they can just add water to and—voilà—instant business.

Nope. That’s a scam. Denis Litvinov, Co-founder of FunCorp and CEO at Yepp, based in Limassol, Cyprus, says this is a mistake of “investing a lot of money upfront before really trying out the new endeavor.”

But even if you’re not investing money, entering a business where you have no experience can lead to problems.

“One of the biggest mistakes we see people making in retirement is starting a business in an area in which they have no expertise,” says Gerald Grant III, Financial Advisor at Equitable Advisors in Miami. “For example, they may want to open a local retail store or purchase rental properties and end up losing funds because they don’t have enough experience in those businesses. One way to do it successfully is to partner with or work for someone in those areas to gain experience prior to doing it on your own.”

Mistake #3: Doing it just for the money

On the other hand, placing money as a priority might lead to a different kind of problem.

“Another mistake we see retirees make is doing it just for the income,” says Grant. “It’s important to make sure whatever you invest in, you have a passion for and a reason why you’re doing it that’s greater than just making money. Often, retirees underestimate the level of involvement associated with small businesses. Many think they can start a small business and the income will just come flowing in without much work involved, and unfortunately, that is not your typical outcome. These opportunities can be very demanding and hands-on, which is often the opposite of how most retirees envision their retirement.”

Mistake #4: Failing to plan

This leads to a bigger question. It’s not just “why” you’re doing it but “how” you’re going to do it. This implies you need to think ahead. And you know what they say about “failing to plan.” It means you’re “planning to fail.”

Don’t plan to fail. Take advantage of the time you have to really think about what you’re going to do.

“Start working on your retirement game plan as soon as possible before you blow up your savings,” says Sam Willis, Founder of Raincatcher in Denver. “You will have a lot of extra time on your hands, and now it’s on you how to utilize it. Do not let your skills go to waste.”

The alternative is getting caught with an unpleasant surprise. This is where the advice of experienced entrepreneurs can really come in handy.

“One of the worst things a retiree interested in starting a small side business can do is not have a plan,” says Shawn Manaher, a former financial advisor who founded 5 online businesses and is a coach, speaker, podcast host, and author based in New York City. “Having a solid plan is what can help you keep moving forward when things get hard. As a rule of thumb, here’s what I recommend when getting started:

  • First, start coming up with a list of business ideas from which you can create extra income. Think through what you are passionate about or what type of skill sets you have.
  • Once you have an idea of what you want to do, start researching the market. What are the different ways that people make money? How can you set yourself apart from the competition?
  • Next, start putting together a plan. How will you start to receive leads? What will be your monthly, quarterly and yearly goals?
  • Finally, go out and take action! Don’t be afraid to start small and grow your business over time. With a little hard work and dedication, there’s no limit to what you can achieve.”
Mistake #5: Forgetting business success comes down to marketing

Here’s a faux pas aspiring entrepreneurs make all the time regardless of their age. The genesis of this error generally comes from an overabundance of technical enthusiasm. Entrepreneurs often focus so much on engineering the product they forget the essential reality of all businesses.

“The classic is to get a coaching qualification and then start up as a coach without learning about marketing,” says Victoria Tomlinson, Chief Executive at Next-Up in Harrogate, UK. “In fact, I would say that is generally the biggest mistake people can make. It is ridiculous, but a lot of people still look down on selling and marketing. Of course, you can never be successful if you don’t market and sell!”

Mistake #6: Using your entire retirement savings

Here’s where you’re doubling your risk. A business failure not only loses you your business, but it can also lose you your retirement.

“The worst thing a retiree can do is use their retirement assets, like their 401(k), to start a business,” says Chuck Czajka, Founder of Macro Money Concepts in Stuart, Florida. “Starting a business comes with a certain degree of risk, but that doesn’t mean risking your retirement savings.”

Liz Miller, Director of Communications at GetSetUp in San Francisco, says it’s best not to “invest all your savings into a small business. It is best to ensure you have the money you need to survive in retirement kept safely away and use additional discretionary funds to invest and start to grow your small business.”

Again, to return to the casino metaphor, it’s not that you can’t use any of your retirement savings (assuming it’s sizable enough), it’s just knowing how much you can safely risk.

“Do not use a large portion (or all) of your retirement funds, no matter how certain you believe your new business idea is,” says Levon L. Galstyan, Certified Public Accountant at Oak View Law Group in Glendale, California. “Over 50% of new businesses fail for reasons beyond the owners’ control. Only spend a small portion of your retirement savings and be prepared to lose it all. You may not lose it, but you must be financially secure if you do.”

Mistake #7: Obtaining a 401(k) loan (or any other loan)

And while the lure is there to use that pot of untapped potential in your retirement plan, you need to be careful how you use it.

“Cashing out your retirement accounts to start a business without a backstop can be disastrous for someone close to retirement,” says Amy Greene LoCascio, Principal and Managing Partner at Eamon Capital Management in Pittsburgh. “Anyone within ten years of retirement needs to make sure the money that they are investing in an entrepreneurial business is ancillary to what they need to retire, or need for retirement income.”

You might be tempted to think a 401(k) loan is the easiest way to access your retirement fund (assuming the plan allows it). But that’s not the only way.

“There are better ways to access your retirement funds for a business startup, such as a 401(k) ROBS rollover , than borrowing against your 401(k),” says Galstyan.

When you get right down to it, however, any loan presents risks far too high for someone in retirement. If this side hustle idea requires that kind of financing, the idea might be too big for you to entertain. You might want to reconsider and take on a smaller project. At least at first.

“It is preferable not to begin your business with borrowed funds,” says Galstyan. “A better strategy is to start small with your financial resources and gradually grow your company by reinvesting profits.”

So, there you have it. Seven deadly sins to avoid when starting a side hustle in your retirement.

But this is just the tip of the iceberg. You may have other new business questions. Not to worry. There are plenty of (free) resources you can access to answer those questions.


What You Don’t Know About Medicare Can Cost You

For years, rising healthcare costs have been a top concern among Americans in or nearing retirement. High inflation has only made paying for healthcare more challenging, especially for those on fixed incomes.

Medicare helps to offset healthcare expenses but does not cover all of the costs you may encounter. Once you join Medicare, you’re still on the hook for certain costs, which may include premiums, over the counter and prescription drugs, and all or a portion of certain medical services and/or devices. In addition, Medicare also doesn’t cover one of the highest expenses many people face in retirement, which is long-term care. That makes it critical to understand how Medicare works and what is and isn’t covered well before you sign up or change plans.

Managing Medicare costs

Traditional Medicare Parts A and B cover certain medical services and supplies in hospitals, doctors’ offices, and other health care facilities, and Part D covers prescription drugs. Medicare supplement insurance, or “Medigap” policies are available through private insurance companies and may help cover certain expenses not covered by Medicare Parts A and B, such as coinsurance, hospital deductibles and other out-of-pocket costs. When you buy a Medigap policy you must have Medicare Parts A and B.

Another thing to be aware of is that Medicare costs are subject to change annually. For example, Part A deductibles, coinsurance and premiums will increase in 2023. Keep in mind, most people do not pay Part A and are enrolled automatically when they turn 65. (Part A premiums, which generally increase each year, only apply if you paid Medicare taxes for less than 40 quarters during your working years.) The opposite holds true for Part B in 2023. The standard monthly premium for Medicare Part B enrollees will decrease by $5.20 a month to $164.90 from $170.10 in 2022. The Medicare Part B deductible will also decrease from $233 in 2022 to $226 in 2023.

A Medicare Advantage Plan is another way to get your Medicare Parts A and B coverage. Medicare Advantage Plans, also called “Part C” or “MA Plans,” are offered by Medicare-approved private insurers that must follow rules set by Medicare. Most Medicare Advantage Plans include drug coverage (Part D). Many have no premiums and offer low or no deductibles, and most plans set limits on the maximum out-of-pocket costs you’ll pay during a plan year. However, you’ll need to use health care providers who participate in the plan’s network. While some plans offer non-emergency coverage out of network, it typically comes at a higher cost. You also may need to get approval from your plan before it covers certain drugs or services.

There’s something else you need to keep in mind as you determine the best options for your needs. If you are enrolled in a Medicare Advantage plan for more than 12 months, then decide to change to traditional Medicare, Medigap plans are no longer obligated to take you without underwriting, which involves passing a health screen. That’s important if you have previously been diagnosed with certain illnesses or chronic conditions. For a comprehensive look at what Medicare does and does not cover, visit .

Don’t miss important deadlines

Once you’ve chosen the options that best fit your needs and budget, one of the best ways to manage ongoing costs is to keep important deadlines in mind. Many people don’t realize that missing key deadlines when signing up for Medicare or making changes can result in paying more for these benefits over time. For example, most people who are already collecting Social Security disability or retirement benefits are automatically enrolled into Medicare Parts A and B when they’re first eligible. If you’re not receiving Social Security benefits, you can sign up for Part A any time after you turn 65. However, in most cases, if you don’t sign up for Part B when you’re first eligible, you may have a delay in getting Medicare Part B coverage in the future, and you may have to pay a late enrollment penalty for as long as you have Part B. In addition, certain higher income beneficiaries are subject to a Part B surcharge called the Income-Related Monthly Adjustment (IRMA).

To help avoid penalties and higher premiums, keep the following in deadlines in mind:

  • Initial Enrollment Period (IEP) – Your IEP lasts for 7 months, starting 3 months before you turn 65, and ending 3 months after the month you turn 65. Beginning January 1, 2023, when you sign up for Medicare the month you turn 65 or during the last 3 months of your IEP, or during the general enrollment period, your coverage starts the first day of the month after you sign up.
  • General Enrollment Period (GEP) – The Medicare GEP occurs each year between January 1 and March 31. It’s generally the only time that people who did not sign up during their initial enrollment period and are eligible for Medicare Parts A and/or B can enroll. Beginning January 1, 2023, your coverage will start the first day of the month after you sign up.
  • Special Enrollment Period (SEP) – Participants who elected Medicare Advantage and/or a Part D prescription drug plan may be eligible to make changes to their coverage under a SEP if they experience a qualifying life event, such as a move to a different state or the loss of employer health insurance coverage. In addition, a new special enrollment period will be available in 2023 to cover exceptional circumstances. This option will help people who miss an enrollment period due to certain events like a natural disaster or another emergency, incarceration or losing Medicaid coverage. Visit to review a full list of special circumstances and applicable rules for each SEP. Keep in mind, if you have employer-based health insurance through your (or your spouse’s) current job, you don’t have to sign up for Medicare while you or your spouse are still working. You can wait to sign up until one of you stops working or you lose your health insurance, whichever comes first.
  • Open Enrollment Period (OEP) – Medicare’s OEP occurs each year from October 15 to December 7. During the OEP, anyone with Medicare can make changes to their health plans and prescription drug coverage for the following calendar year. Even if you weren’t planning on making changes to your benefits this year, take a few minutes to review what’s new. Always review the materials your plan sends you, including the “Annual Notice of Change” and “Evidence of Coverage” to make sure your plan will still meet your needs for the following year. You can also join, switch, or drop a Medicare Advantage Plan during the OEP. If you join a Medicare Advantage Plan during this period but change your mind, you can switch back to traditional Medicare or change to a different Medicare Advantage Plan (depending on which coverage works better for you) during the Medicare Advantage Open Enrollment Period (January 1 – March 31). If you haven’t received your copy of the official U.S. government handbook, download Medicare & You 2023 or visit for more information on plan changes and benefits.


Required minimum distributions deadline approaching

Although you can’t avoid RMDs, you can take some steps to minimize them. And in most cases, it’s best to take those steps before New Year’s Eve.​

Required minimum distributions (RMDs) from employer-based retirement plans and traditional individual retirement accounts (IRAs) will be due Dec. 31 for most people 72 and older. Those distributions are taxable, and that can take the sparkle out of many taxpayers’ holidays.​

How RMDs work

There’s a reason accountants call traditional IRAs and other retirement plans “tax-deferred plans,” not “tax-free plans.” You don’t pay taxes on your account contributions or earnings — until you take withdrawals. And there’s a deadline for how long you can wait before taking the distributions that federal tax law requires. When you turn 72, you must start taking RMDs every year. These rules apply not just to IRAs but also to 401(k), 403(b) and other retirement plans. Roth IRAs are not subject to RMDs, but Roth 401(k)s are.​


RMDs are based the IRS life expectancy tables. For example, at 72, the average person is expected to live another 27.4 years. To figure the RMD for that year, a person would divide her IRA balance by 27.4. If the balance were $100,000, the person would have to withdraw $3,650, and pay taxes on the withdrawal. ​


With one exception, you must take your RMD by Dec. 31. The exception: When you turn 72, you have until April 1 of the following year to take your RMD and pay taxes on it. Years ago, Congress determined that it would be benevolent to give people a three-month grace period on their first RMD, says IRA expert Ed Slott. “But that’s not really a great deal, either,” Slott says. Why? Because you’ll also have to make an RMD by Dec. 31 of that same year — in effect, making two RMDs in one year and possibly pushing you into a higher tax bracket. You’re probably better off paying your first RMD in the year in which you turn 72, Slott says. ​


Your RMDs are based on the value of all your tax-deferred accounts as of Dec. 31 of the previous year. If you have several tax-deferred accounts, you have to figure out the RMD for each one. You may, however, take the entire RMD out of just one account. If you have already taken distributions during the year that are equal to or more than your required RMD, you don’t have to do anything else to satisfy the RMD requirement.​


The penalty for not taking an RMD is severe: 50 percent of the amount you should have taken out. If you neglect to take a $3,000 RMD, you’ll owe a $1,500 penalty. Although the IRS will sometimes forgive the penalty, it’s best not to incur it in the first place. 


The 20 Coolest Ski Lodges In The World

This year, the 2023 season will mark the highly anticipated return to destination ski vacations.


The most popular ski resort destinations in the world include notables such as; Gstaad, Switzerland; Zermatt, Switzerland; Aspen, Colorado; Courchevel 1850, France; St Moritz, Switzerland; Megève, France; Vail, Colorado, and Whistler, Canada.

Here are the ski hotels & lodges that Five Star Alliance considers the Best Of the Best for 2023 featuring the highest TrustYou scores, the best free Five Star Alliance perks, and the ones that guests have booked the most over the last year.


Fairmont Banff Springs (Banff, Canada)

Located in the Canadian Rockies, the historic hotel, which opened in 1888, offers up 745 guest rooms and suites, as well as a large spa, an outdoor skating rink, and private campfire pits. Guests can Ski the famous “champagne powder” at any of the three Banff ski resorts in Alberta; Sunshine Village, The Lake Louise Mountain Resort, and Banff Mount Norquay.

Four Seasons Whistler (Canada)

Whistler is home to North America’s largest ski resort. Blackcomb Mountain is just a three-minute walk from the Resort, where you will have your own Ski Concierge. The hotel offers up 273 rooms, including gas fireplaces and balconies with stunning views, a spa, a heated outdoor pool, and 3 hot tubs.

The Arrabelle at Vail Square (Vail, Colorado)

Located at the heart of Lionshead Village, with an open-air ice rink during the winter, the chalet inspired resort offers direct access to Vail Mountain via the Eagle Bahn Gondola steps away – with 5,289 acres of ski and ride terrain and nearby Beaver Creek. The 62 luxurious rooms feature massive bathrooms, stone fireplaces, and scenic balconies. Guests enjoy endless amenities like personal butler service, ski valets, a rooftop pool, and a large spa.


Airelles Courchevel (Courchevel, France)

This resort located at the bottom of the slopes offers Ski-in/ski-out access to Jardin Alpin. With a strong Austro-Hungarian castle vibe, the hotel features 48 rooms including 20 Suites and 1 Apartment. There are 5 bars and restaurants, and a La Mer Spa.

Aman Le Melezin (Courchevel, France)

This chateau style boutique resort is a contemporary spin on the classic ski lodge with ski-in and ski-out access. There are 31 Alpine rooms with seven suites, all with balconies, private hot tubs or fireplaces. Aman Le Mélézin offers access to the Three Valleys network, aided by a team of experienced Ski Butlers who transport ski equipment from the heated racks in the state-of-the-art ski room. The new, Japanese-inspired Aman Spa has five double treatment rooms and is perfect apres ski.

Kulm Hotel (St. Moritz, Switzerland)

The Kulm Hotel is located in the heart of world-famous St. Moritz. The chic, elegant and exclusive resort offers 173 rooms and suites and attracts a sophisticated, cosmopolitan crowd thanks to its glamorous events, such as the Snow Polo World Cup and White Turf on the frozen lake. It also hosted the Winter Olympics twice and is home to the oldest and only remaining natural ice bobsled run in the world. Enjoy the huge 21,000-square-foot spa for apres ski.


Some large employers suspended matching contributions to retirement plans last year, but this was only temporary for many of them. Studying 260 such companies, consulting firm Towers Watson reports that 75% have already restored employer matches, with 74% matching at the same level they did before the arrival of the pandemic.*

Source: MarketWatch, December , 2020

Did you know?

Looking for the longest beach in America? Try over 70 miles long!

The longest beach in the U.S. is Cape Hatteras National Seashore in North Carolina stretching 70.4 miles in length. Cape Hatteras National Seashore protects parts of three barrier islands: Bodie Island, Hatteras Island, and Ocracoke Island. Beach and sound access ramps, campgrounds, nature trails, and lighthouses can be found and explored on all three islands.*

Source:, July 18, 2022

On the Bright Side

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