SCORE Volunteers Make Dreams Come True

Q: I’m at the age of retirement and have an opportunity to sell my business.  Although I’d like to slow down, I’m not ready to stop working entirely. Any advice?

A: Why not spend some of your time helping promising entrepreneurs start or run their own small businesses?  You could share your business expertise, give back to your community, gain satisfaction from seeing others succeed and connect with like-minded people by volunteering with SCORE.  Each year, SCORE counselors touch thousands of lives, generously sharing their knowledge and experience so that entrepreneurs can realize their dreams of business success.

Nationwide 13,000 men and women in 364 SCORE chapters donate their time and talent to assist America's small businesses.  At SCORE Houston, volunteers provide confidential one-to-one and team business counseling and low-cost training workshops and seminars. In addition, many counselors are virtual volunteers, providing email counseling directly from their homes or offices. SCORE members can not get paid for the services they provide to our small business clients.

Whether you have owned your own small business, come from a large company, are retired, are a college student, or just have a sincere commitment for helping small businesses or volunteering, there is a place for you at SCORE.

Whatever their background, SCORE counselors share a belief that small business owners are more likely to succeed if they have a business mentor to guide them.  We currently are seeking new members of diverse backgrounds and experiences to complement our current team of over 70 volunteers in the Houston area.

Our members choose from a variety of ways to contribute to our mission. Most of our counselors are focused primarily on helping aspiring entrepreneurs develop their business plans and launch their first business.  Many work with clients to find the financing needed to start or expand a small business.  Others are involved in organizing client educational sessions, carrying out our chapter outreach programs, or important administrative functions.

New members go through an orientation program to get familiar with SCORE and comfortable with the counseling process.  All members stay up-to-date by attending regular monthly training sessions.

In Houston, we share offices and work closely with the Small Business Administration.  We have several satellite locations throughout the city.  Check out our web site, www.scorehouston.org.

If you have any questions or would like to volunteer, please e-mail us at scorehouston@gmail.com, or, call our office at 713-773-6565 and request a call from our membership coordinator. 

Financing a business with retirement funds

Q: I’d like to buy a business but most of my funds are tied up in a rollover IRA. Is there any way to use those funds for a new business?

A: Yes, you can invest your retirement account funds in your own business. This can help get you off to a good start by building equity and reducing the need for debt and cash flow. These are important factors for the long-term success of your business.

Funding a small business through the use of retirement plans is ever more prevalent in today’s economic environment, as bank loans and other sources of capital have become more difficult to obtain. It can be attractive for individuals who have suffered from downsizing, closures and lay-offs or who have just retired early.

This type of self-reliant funding is available to just about anyone who has an existing retirement plan and who has terminated employment with the employer where the funds were accumulated or for someone who just has an IRA. The money invested through a properly designed retirement plan can be used to fund the start-up of a new business, purchase a franchise, purchase an existing business, and in some instances, raise capital for an existing business.

The process calls for the assets in your existing retirement plan to be rolled over – tax-deferred and penalty-free – into a newly established qualified retirement plan for you and your new company’s employees. Then the new IRA assets can be invested in the stock of the new company as well as mutual funds, individual stocks and other types of investments.

At the completion of the process, your new company can raise cash from the sale of stock to the retirement plan which in turn holds company stock as a plan asset. The cash can be used for legitimate investments in the business or to pay legitimate business expenses.

With this type of funding, it’s extremely important to consult with a firm that specializes in retirement plan design and administration. As with any qualified plan, compliance with rules and regulations is critical.

Business financing of any kind comes with risks – the risks inherently associated with opening a new business or purchasing an existing one. Before you decide to use your retirement funds, or any other type of financing for that matter, you should ensure that you have a viable business idea, a comprehensive business plan, adequate capital, and the consultation of small business professionals, like those at SCORE,  who can provide advice and guidance for your new venture.