Encore Entrepreneurs: Why Gen X is Turning to Business Ownership in Retirement

Gen X is redefining retirement through entrepreneurship

For Generation X, those born between 1965 and 1980, the idea of retirement is undergoing a significant transformation.

As many approach traditional retirement age, they are finding that business ownership and entrepreneurship offer a new way to secure their future, blending financial independence with personal passion.

A recent survey conducted by ZenBusiness reveals that nearly 40% of Gen Xers are either considering or have already embarked on entrepreneurial ventures. For them, retirement isn’t about stepping away from work but stepping into something new—a phase defined by flexibility, independence, and control over their financial destiny.

Traditional Retirement vs. Modern Realities

For Generation X, financial uncertainty is a pressing concern. Nearly half of respondents in the ZenBusiness survey indicated that they are unsure whether they will be able to retire by the age of 65. With the rising costs of living, healthcare, and economic instability, traditional retirement savings strategies such as pensions and 401(k)s are no longer seen as sufficient.

In response to these uncertainties, more Gen Xers are turning to entrepreneurship as a way to maintain financial security. Ross Buhrdorf, CEO of ZenBusiness, emphasizes this shift: “For many Gen Xers, retirement is no longer about stepping away from work—it’s about stepping into something new.” With 45% of respondents viewing business ownership as a stable path to financial independence, it’s clear that this generation is seeking alternatives to traditional retirement models.

Key Motivations for Gen X Entrepreneurs

The motivations driving Gen Xers to entrepreneurship are clear and compelling. According to the survey, 52% of respondents cited independence and control as their primary reasons for starting a business. After decades in the workforce, many members of Generation X are looking for a way to be their own boss, make their own decisions, and build something meaningful.

Flexibility is another key motivator, with 34% of respondents highlighting the importance of work-life balance. For those nearing retirement age, entrepreneurship offers the chance to create a lifestyle that accommodates both personal and professional goals. Whether it’s spending more time with family or pursuing a passion project, Gen X entrepreneurs are redefining what it means to work during retirement.

Beyond the practicalities of financial stability, many Gen Xers see entrepreneurship as a way to pursue their passions. In a world where personal fulfilment is becoming just as important as financial success, business ownership offers a path to achieve both.

Barriers to Starting a Business

Despite the appeal of entrepreneurship, starting a business comes with its own set of challenges. According to the survey, access to capital is the biggest barrier for aspiring Gen X entrepreneurs, with 56% citing it as their top concern. Starting a business often requires a significant upfront investment, and finding the necessary funding can be a daunting task, especially for those already concerned about their financial future.

Other barriers include time constraints, lack of experience, and the legal complexities involved in running a business. Legal expenses and the risk of failure are also common concerns. However, there is hope on the horizon—technology is playing a crucial role in overcoming these challenges. Thirty percent of respondents believe that AI can help streamline business operations, making it easier to manage a company while still enjoying the benefits of semi-retirement.

Income Sources in Retirement

As Gen Xers contemplate retirement, they are diversifying their income sources to ensure financial stability. The survey revealed that 68% of respondents plan to rely on Social Security as a key source of income, while 41% plan to use their savings. However, these traditional income sources may not be enough, prompting many to explore supplemental income through part-time or full-time work during retirement.

Entrepreneurship offers a compelling solution to this challenge. Forty-five percent of respondents view business ownership as a stable route to financial independence during retirement. By starting a business, Gen Xers can create a steady income stream that supplements Social Security and personal savings, allowing them to enjoy their retirement without financial stress.

The Rise of Encore Entrepreneurs

This new wave of Gen X entrepreneurs has been dubbed “Encore Entrepreneurs”—individuals who are starting businesses later in life to fund their retirement. For many, this shift is not just about money; it’s about fulfilling a long-held dream or passion that they couldn’t pursue earlier in life due to career or family responsibilities.

Consider the example of an experienced corporate executive who, upon reaching her 50s, decides to open a consulting firm. After years of working in the corporate world, she has the knowledge, experience, and connections to succeed in her new venture. By starting a business, she’s able to maintain an income, work on her own terms, and even enjoy a more flexible schedule—something she couldn’t achieve in a traditional 9-to-5 job.

Similarly, others are turning hobbies into businesses, from artisanal crafts to online coaching, using their newfound freedom to explore new avenues of work. The possibilities are endless, and for many, the joy of entrepreneurship is just as valuable as the financial rewards.

Now is the time to act

Gen X is redefining what retirement looks like in today’s world. Instead of stepping away from work, they are stepping into new opportunities—ones that offer financial security, personal fulfilment, and the flexibility to design the retirement they want. With entrepreneurship providing a stable path to independence, Generation X is showing that retirement can be whatever they choose to make of it.

For those considering a similar path, now is the time to act. Whether you’re seeking financial stability or looking to turn a passion into a business, entrepreneurship offers a thrilling opportunity to shape your future.