By Elizabeth O. Cooper
After Al Hockaday retired from the U.S. Marine Corps, he and his wife, Ernestine, moved to Lexington and opened a gift shop.
After toiling as a university administrator for more than 30 years, Ned Lester was ready to take the commonwealth up on its early retirement program, but he wasn’t ready to spend his golden years on the golf course or touring the country in a Winnebago.
Instead, 61-year-old Lester walked off the Virginia Tech campus and into the Virginia Tech Corporate Research Center where he opened Global Opportunities Inc., a consulting firm representing companies in international markets.
Lester spent the last five years of his tenure with Virginia Tech forming research and trade relationships between the university and national and international groups. He parlayed that expertise into a firm that is rapidly becoming an international presence.
“I knew I didn’t want to work all the way to 65. I still had the time to start a business, and I was young enough to put my energies in it,“ he says. “This sort of seemed natural.“
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Lester is one of a growing number of seniors who are changing the definition of retirement. Some aren’t content to retreat from the work force into a rocking chair. Others want or need extra income to supplement their pensions. With a lifetime of knowledge and experience under their belts, these retirees are breaking new ground.
“Previously we tended to talk about retirement in terms of exiting the work force,“ says Karen Roberto, director of Virginia Tech’s Center for Gerontology. “But we’re beginning to realize that we’re moving beyond the traditional stereotype about life course, that you reach a certain age, and [work] comes to an end.“ Rather than ending their professional days, retirees are embarking on a variety of trades, from exploring technological wizardry to operating catering services.
“It keeps them active and a part of the community,“ notes Thelma E. Bland, commissioner of the Virginia Department for the Aging, which last year studied ways to encourage seniors to rejoin the work force or form new ventures. The study found that small businesses are a promising field for retirees. After all, many exit their careers with not only a gold watch, but a comfortable income and health benefits. Starting anew is less risky. “There could be a void in the community of a particular business, and people ask them to start one, or a hobby may have developed into a business opportunity,“ she says.
Bland expects to see this trend continue as more people retire earlier and set up new ventures. This new cadre of workers could become a real force in the commonwealth because its many college towns and temperate climate make it a haven for retirees. Bland believes that Virginia is the ideal setting for these new businesses. “The entire state tends to lend itself to the creation of business. Virginia offers so much diversity.“
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State agencies, such as the Center for Innovative Technology and the Virginia Economic Development Partnership, were invaluable to Lester when he formed Global Opportunities. “Small-business people need to be cognizant of them and what services they offer,“ he advises.
He was also able to call on his contacts within the state and federal governments and foreign embassies to promote his firm’s services, one of which is Protrade, a program in which companies throughout the world market their products over the Internet. Currently, 10,000 firms are listed with Protrade. With the growth of his company, Lester has hired seven employees, including a retired Virginia Tech professor and a retired CEO with 20 years’ experience in international trading. Lester also plans to hire a marketing director to promote Protrade in Northern Virginia.
He advises retirees to not get so overwhelmed with their new ventures that they forget why they opted to retire. “Once you get into it, you can get so dedicated that if you don’t watch it, you’re under stress again,“ Lester says. “You’ve got to blend it with enjoying retirement or otherwise you’ll find yourself back in a six- or seven-day-a-week job worrying about the payroll.“
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Jack Brayley and his wife are taking it slow. They opened The Glass Market in Richmond 10 years ago after taking a course in stained glass. The couple make and sell some pieces, but their shop primarily supplies materials for hobbyists and is the largest of its type in the area.
“When we opened the store we had a manager, but we decided that wasn’t for us,“ Brayley says. Now The Glass Market is only open from 10 a.m. to 3 p.m. four days a week and is closed in the winter.
That’s the way the Brayleys like it. “It’s the type of business that suits us fine, and we’re providing a service.“ Brayley’s background in accounting has contributed to The Glass Market’s success. “With this type of business, you have to be on top. You’ve got to compete with other stores and offer something a little better to get people there.“
Offering that little bit extra also works for Al Hockaday and his wife, judging from the growth of Shenandoah Attic and Victorian Parlour. The Hockadays decided to open a gift shop when they moved to Lexington after he retired from the U.S. Marine Corps seven years ago. Two years later, their business had grown to the point where they needed to open a second store. “We wanted to do something relaxing after retirement and figured that a mom-and-pop gift store would be just the thing,“ Hockaday recalls. “It didn’t turn out to be that way. With the sheer numbers of people coming in and requesting certain items, we brought in the items and needed more space. Each store has gotten bigger and bigger.“
At the same time the couple delved into their new trade, Hockaday spent four years as a sergeant major for Virginia Military Institute’s corps of cadets. “During that time my wife literally ran both stores by herself,“ he says. “It was a lot of work, but we both enjoyed it. We were working on our own time and calling our own shots.“
The success of these two businesses puts the Brayleys and Hockadays in the minority among small-business owners. According to Terry Riley, director of the Accelerated Career Transition Education program at Old Dominion University, only about 10 percent of venture start-ups in the United States remain in business after five years. Still, Riley believes that Virginia is more welcoming to new businesses than most states. “The metropolitan concentrations in Virginia are particularly receptive to trying those kinds of things because there are large densities of populations, and they’re service oriented.“
But Hampton Roads retirees are faced with the added challenge of competition from a large contingent of military retirees. “This is one of the favorite terminal duty stations in the U.S. Navy,“ Riley notes. According to Roy Pearson, director of the Bureau of Business Research at the College of William and Mary, those military retirees have been planning for retirement their entire careers. “They’re younger, and they’re used to being in executive and leadership positions,“ he adds.
Federal cutbacks have increased the number of military retirees, while corporate downsizinghas led to former executives testing the waters with their own businesses. They often run into financial roadblocks. “Most people can’t start a business on their own money,“ Pearson notes. It’s especially difficult to get venture capital for high tech start-ups. “A lot of financial institutions don’t want to make you a loan based on brain power.“
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That’s where networking comes into play. With more than 275 members age 50 and older, The Professional Group at George Mason University helps retirees and downsized employees return to the work force. Prospective members must have at least 20 years of experience in their field.
“It’s a unique group,“ says William A. Boleyn, president of the organization that includes lawyers, engineers and high-tech personnel. “Our members are people who for the most part want to get back into the work stream. As industry and business look at downsizing, this group of people is the most likely to be pushed out. We need to support them.“ Many retired when their jobs were eliminated. “They find themselves with a great deal of capabilities, energy, dedication and desire to work, but find it very difficult because of their senior status to get back into the work stream.“
Fifty-one members own their own businesses and use the group’s facilities and databases to develop new clients and products. In addition, 31 members are interested in forming businesses. Several small firms have even gotten their start through The Professional Group.
The group also has corporate sponsors who pay annual fees to use its database to hire personnel and consultants. Income tops the lists of incentives for these commercial ventures, Boleyn notes. But many want to rejoin the working world for social or personal reasons.
Howard Leith looks for new challenges when starting a business. The former investment banker has pursued three ventures along with other members of The Professional Group. Right now he’s involved in developing a memorial park for cremated remains in Northern Virginia and is an ongoing partner in a turnaround business development management group that provides emerging companies with part-time executives.
“It’s fun to start a business or to work with emerging businesses and get in and solve real problems,“ Leith says. “I would be very unhappy sitting around fishing or gardening.“
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For other retirees, casting a line toward new ventures means first wading through the mire of bureaucracy when it comes to reconciling their additional earnings with their Social Security benefits. For every $2 over $8,640 that Americans age 62 to 65 earn annually, they lose $1 of Social Security benefits. Those over 65 can earn up to $13,500 per year before losing $1 of Social Security income for every $3 over that cap. People age 70 and older can earn as much as they want without losing any benefits.
“Because of those restrictive provisions, retirees are very careful about going into the work force,“ says Robert J. O’Brien, president of Financial Security Group Inc. in Virginia Beach. “A lot of retirees do things on a part-time basis, staying within the income cap that Social Security imposes.“ The amount that people over 65 can earn will increase to $30,000 by 2000, a welcome change for senior entrepreneurs.
“When they paid into Social Security, they paid in with after-tax dollars,“ O’Brien notes. “But the law says that if you make a certain amount of money it will be taxed again.“ Despite the Social Security restrictions, O’Brien is seeing a trend toward early retirement, especially among government employees who can retire in their mid-50s with 30 years of service. “They can keep their health insurance coverage through the government and go out and start their own business without having to worry about benefits.“ Many of those people are making their base in Northern Virginia.
Lawrence O’Brien, an insurance broker with O’Brien and Associates in Annandale, advises retirees contemplating capital ventures to consider their age and financial security. “When people are in their 20s and 30s they can be fairly aggressive about investments. If they’re in their early 40s to mid-50s and have a good financial base, it could be very rewarding not just financially but personally. Once they hit 60, they should be conservative. I see a lot of danger when you put a lot of money at risk.“
The 13 senior entrepreneurs Bill Holloran is helping are not gambling with their life savings. “They’re not taking risks of an inordinate manner,“ says the senior vice president of the Hampton Roads Small Business Development Center. “It’s well within their net worth. They’re really just people leveraging their expertise for additional income.“
Retirees seeking assistance from the center are involved in an array of businesses from retail to technological start-ups. Selling merchandise at weekend exhibitions and craft shows is a big thing, Holloran says. “One started a financial organization and is leveraging another business. One client is fairly wealthy and invests in other firms and brings his managerial expertise to the equation.“
Most retirees conduct businesses from their homes in one- or two-person setups. “Most people are not going to embark on a new venture to grow a business over a five- to 15-year period when they’re 62 to 65,“ Holloran says.
Still, he notes that retirees’ business endeavors have a positive effect on the national economy, where half of the gross national product comes from small businesses. “I would expect that they do just a little bit better than someone younger because of their years of experience,their financial stability and productivity.“
THE GRASS IS GREENER
While it may not be a post-retirement career, some former executives are signing up for shift work at a dream job. The pay? Certainly nowhere in the six digits—our informal survey started at zero and topped out around $7 per hour. Stock options are nonexistent. But the other benefits make it worthwhile: free golf and membership in an exclusive club of retirees.
The job? Starter.
At the Crossings in Glen Allen, starters—who guard the sanctity of tee times by getting golf parties off and moving—get an hour on the greens for every hour they work. Fairfax National and Richmond’s River’s Bend also have cadres of retirees who act as marshalls and rangers, run golf carts and get to play as much golf as they want.
Walt Krabacher doesn’t want to say how much he earns at Lee’s Hill Golfers’ Club in Spotsylvania, but he’s more than happy to talk about the perks of his job. “I get to play here often,“ the 68-year-old starter says. “It’s a beautiful course—one of the best courses around.“
Krabacher retired five years ago as the West Coast regional service manager for Monarch Marketing Systems of California. In his first year of retirement he and his wife traveled, then they moved to Spotsylvania to be closer to their daughter’s family in Burke. He heard about the job at Lee’s Hill through a friend.
Krabacher is one of a handful of retirees working at the course, most of whom work a couple of days a week. “They live in the area and like golf and they would like to work,“ says Pat Fountain, Lee’s Hill’s head pro. He likes having them around, he notes, because they’ve got broad experience and “they’re not in it for the money.“
Although the job may seem like fun and games, golf clubs take their starters seriously.
“They’re the kind of the front line. They’re the first people our customers see,“ Fountain says. “They handle themselves professionally.“
The job also has its challenges, Krabacher notes: “Occasionally I’ve had problems. Being a starter, you have to get people off on time. We try to accomodate them.“ After all, as one golfer notes, it’s a gentlemen’s game abd players are expected to conduct themselves accordingly.
But Krabacher has seen a few try to take a mulligan on the first tee. “We allow it, sometimes.“
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