Small business owners work into their 60s

Almost 60 per cent of small business owners still expect to be working full-time into their 60s and beyond, according to a recent survey.

The report by NatWest's Small Business Research Trust found the older the entrepreneur, the longer they expect to have to work.

The gap in retirement expectations was stark. Those under the age of 40 expect to be able to retire from their business within 10 to 15 years, when they are between 50 and 55. Whereas, those aged over 40 don't expect to retire until they are between 60 and 78.

An air of uncertainty prevails over what will happen to the business once the entrepreneur makes the decision to retire, with 38 per cent unsure of what they will do with it. Just over a third ultimately expect they will sell, 14 per cent think that they will pass it on to a family member and 13 per cent say they will close their business down.

For the very smallest firms, over 60 per cent expect to have to close down their business on retirement, compared with only five per cent of those with a turnover of between £250,000 and £1 million.

Over two-thirds of these higher turnover businesses expect they will sell the business and one in five will pass it on to another member of their family.

Small business owners who are close to retiring have a clearer view of what will happen to their business upon retirement. Over half of those who expect to retire within a year, and over one third of those who will retire in two years, expect their business will close, compared with less than one fifth of those who do not expect to retire for more than two years.

In the majority of cases, respondents' expectations of what will happen to their business are in line with the original plans they had when starting up. Over half of those who thought that they would pass their business onto a family member still intend to do so and two thirds still expect to sell their business when they retire.

Other key findings from the survey include:

• Government regulations and paperwork is still the biggest single
  problem facing small businesses.
  
• Thirty-five per cent of respondents own their business outright.
  Almost two in five are part owners in a non-family firm.
  
• Half of the respondents are involved directly with a business other
  than their own, 28 per cent as directors or owners of another firm.