Daniel Budreika has provided input to a News Corp article reported today on how the ‘2.1 Million small business owners’ may not be able to retire they way they want. This is based on research from MYOB indicating that 50% of small business owners under 50 have done no superannuation planning.
MYOB CEO says: “Our research shows that SMEs believe they will need around $1 million to retire comfortably yet 54 percent of them will not have saved enough when the time comes,” says MYOB CEO Tim Reed. “They will always sacrifice themselves to make sure they pay their employees and their employees’ super first,” he said.
Daniel’s input was that many business owners treated their business as their superannuation, but this was a very risky approach. “It’s risky for people to not put money aside, because their business may not be worth a lot for them to sell when they want to exit.”
The article goes on to interview Joel Trethowan, managing director of marketing agency Alchemy One. He did not contribute to super when he started the business in 2012 because there were “so many other priorities and financial matters.”
Joel went on to explain that: “Cash flow is a constant struggle in the earlier years of business and while super is incredibly beneficial long term, for many small businesses, it’s about year-to-year survival and growth.”