For the majority of entrepreneurs, the traditional path to financial success involves climbing the corporate ladder, receiving a six-figure salary or more, and earning enough money to retire comfortably.
Achieving financial security often involves a solid plan for reoccurring passive income.
With that said, one of the best ways to generate the kind of passive income necessary to achieve your goals is through franchise ownership.
The Great Retiring
According to the American Association of Retired Persons (AARP), nearly 10,000 people turn 65 every day in the United States. With Baby Boomers retiring in mass, the country will see a change in how business is done as more Gen X, Millennials and Gen Zers move into positions of power.
And with this great retirement period, millions of retirees are looking to supplement their retirement income with the types of passive income that will enable them to maintain the lifestyle they led during their working years.
These changes have even started a new cottage industry, complete with a tax write-off. For example, the Rollovers for Business Startups (ROBS) method allows people to use their retirement funds to buy or start a franchise without incurring tax penalties or early withdrawal fees.
Put simply, a ROBS plan allows you to access your retirement funds ahead of schedule. If you’ve been contributing to your 401(K) since you first entered the workforce, you may have a sizeable sum of money by the time you reach your late 40s or early 50s.
You might be able to launch your franchise debt-free. This could have a significant impact on your future earnings.
But, even if you aren’t considering retirement just yet, investing in a franchise model can allow you to earn more money to put into your eventual retirement account and provide your family with a means to acquire generational wealth.
Franchises to Consider
When consumers or entrepreneurs think of franchising, they often think of brands like McDonald’s or 7-Eleven. The truth is there are a limitless number of thriving franchises to choose from outside of the fast food and roadside convenience stores. In fact, some of the most lucrative franchises cater to home and business services. There is always a need for printing and shipping services as seen during the pandemic.
When considering a franchise, you should look for companies that have a high return on investment, have a proven record of success and have a company culture that aligns with your personal belief system.
Even if you don’t have a background in a particular industry, you can still use the business skills you’ve developed. If you have the right capital and business acumen, an effective franchisor that has developed a great business model can train you for success.
On the Road to Freedom
For a franchise to have become successful enough to have locations all throughout a region or the country, it has to have built a successful business model, the right technologies and a proven training program.
It’s also perfect for those who want to earn passive income because it comes without the many headaches that startups have. A franchise has already been tested for success in a variety of locations. Advantages include:
- Brand awareness. If you start your own business, a fair amount of your time will be spent getting your name out to potential customers. With an established franchise, their corporate office has done that for you and will continue to invest in ensuring positive brand recognition.
- Corporate support. For the startup owner, purchasing the technology and providing employee perks can be a daunting task. Other than paying salaries, technology and benefits are the largest part of a company’s operating budget. With centralized technology, marketing and employee benefits support, you can build a buffer that allows you to use your cash to improve your business locally.
- Ongoing revenue generation. Most importantly, with the help of a proven franchisor behind you, you’ll be able to get your company up and running in a shorter amount of time. That means you’ll be earning profits sooner, and if you follow the plan, you can continue to grow your business.
Investing in a franchise may allow you to enjoy your success. Being your own boss allows you to set your best work/life balance so you can flourish in your personal life, too.
Investing in a franchise may help you achieve the financial freedom you’ve always wanted, spend more time with family, volunteer more often or even retire with the stability of knowing that you’ll have the passive income necessary to sustain your lifestyle.
Bill McPherson is the vice president of retail network development for AlphaGraphics, a leading franchisor of printing and marketing solutions, and PostNet, a global leader in high-quality printing and shipping solutions. With over 29 years of franchise leadership, he has led franchise development and real estate for B2B, B2C, retail, and in-home senior care concepts.
For more information, visit https://alphagraphicsfranchise.com/.