Small business owner parents are more optimistic about their children's future than all parents

NEW YORK, January 24, 2018 – Parents who are small business owners are more optimistic about their children’s future than parents overall, according to a new survey from New York Life.  More than 75 percent of small business owners with children under the age of 18 believe that their children will have a better standard of living than they do, versus only 67 percent of the general population said the same in a survey of parents conducted in December 2017.  Small business owner parents are also more optimistic about the future of all children in the United States.

“What this tells me is that being in the driver’s seat, as many small business owners are, is empowering and puts them in a brighter place when thinking about what lies ahead for the future for children – and especially, for their own children,” said Brian Madgett, vice president, New York Life.

For the survey, a sample of 1,059 small business owners were interviewed, including a subset of 586 small business owner parents who have children under the age of 18 living in their home.  The survey was conducted in January 2018 by Ipsos and sponsored by New York Life.

Business = Small Business Owner’s Personal Pension

“Small business owners are counting on their business to provide for them in retirement.  For many entrepreneurs, their business will serve as their own personal pension and what they rely on to provide retirement income, with 42 percent reporting that their business is their retirement plan.  Small business owners know how important it is to protect their retirement as well; 66 percent say they need to do more to ensure they have adequate income from their business in retirement and 54 percent have a backup plan if they are unable to sell their business or if the proceeds are not sufficient for retirement,” added Madgett.

Taking steps to ensure their finances are in order will be important especially to the 51 percent who report that they plan to retire at the age of 65.

2018 Focus is on the Future; Short Term Growth Plans Have Slowed Since 2017

Financial expectations for small businesses in 2018 remain high with 61 percent of small business owners optimistic.  This mirrors the sentiment recorded in last year’s New York Life survey of small business owners, where 60 percent reported expecting business to improve heading into 2017.

More than 70 percent of small business owners state that technology will have a positive impact on their business in 2018.  Forty-six percent feel that tax policy is a positive for their business.  Here is how other aspects ranked in terms of a positive impact on their business in 2018:

Interestingly, there are some differences since last year in terms of what small business owners will focus on when it comes to planning.  With an eye toward the future, a large percentage, 62 percent, of small business owners plan to address business continuation planning in 2018 and a similar amount, 66 percent, of small business owner parents plan to involve their children in their business this year.  But, short term growth plans have slowed somewhat since last year with fewer planning to seek additional capital (45% vs. 55%), hire more employees (42% vs. 52%), and grow their companies (57% vs. 62%).

Yoda – Don’t Try. Do

When small business owners are asked what Star Wars character they most identify with when it comes to financial planning, rises to the top, Yoda does.

“A famous quote that resonates with me when working with small business owners every day is something that Yoda says all the time: “Do or do not, there is no try.”  Most successful small business owners I talk to believe that failure is not an option.  They are not starting a business to try to be successful, instead, they will do everything needed to be successful,” said Madgett.  “Also, I am not surprised to see Princess Leia and Hans Solo next up – the adventurous and risk-taking aspects of those personas are also very much a part of the small business owners I meet.”

About the survey

These are the findings from an Ipsos poll conducted January 2 - 11, 2018 on behalf of the New York Life. For the survey, a sample of 1,059 small business owners (ages 18 and over) from the continental U.S., Alaska and Hawaii was interviewed online, in English. To qualify for the survey, respondents had to be owners of business that employed no more than 500 employees. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll has a credibility interval of ± 3.4 percentage points for all respondents surveyed.

Aabout New York Life

New York Life Insurance Company, a Fortune 100 company founded in 1845, is the largest mutual life insurance company in the United States* and one of the largest life insurers in the world.  New York Life has the highest possible financial strength ratings currently awarded to any life insurer from all four of the major credit rating agencies: A.M. Best (A++), Fitch (AAA), Moody’s Investors Service (Aaa), Standard & Poor’s (AA+).**  Headquartered in New York City, New York Life’s family of companies offers life insurance, retirement income, investments and long-term care insurance.  New York Life Investments*** provides institutional asset management.  Other New York Life affiliates provide an array of securities products and services, as well as retail mutual funds.  Please visit New York Life’s website at www.newyorklife.com for more information.