Colorado Springs Financial Briefs: February 22, 2008

Nearly half of all small-business owners surveyed by KeyBank will delay retirement.

Shawn Cole, district retail leader for Colorado, said a poll of 976 small-business owners showed contradictions between finances and retirement planning.

Many small-business owners are putting most of their emphasis on the business and its immediate concerns, while tending to ignore long-term planning.

"Our survey showed that the biggest concerns on their minds are taxes, debt, energy costs and government regulations," he said. "Planning for retirement is not on their radar."

Generally speaking, Cole said, retirement planning should include a visualization of what business owners want their future to look like and an estimate of how many years they plan on being retired.

If they want a lifestyle that includes dining out a lot or driving expensive cars, they need a different plan than if they're willing to scale back quite a bit and downsize their residence, Cole said.

Planning should anticipate how much monthly expenses will be, including emergencies. Small-business owners should seek the advice of financial advisers and planners, he said, to find out if they need to expedite their retirement plan.

"People need to forecast at least 60 percent of what they're earning now to have on an annual basis for retirement," Cole said.

Reasons cited for delaying retirement included concern about rising healthcare costs and the need for more savings.

BKD brings Corporate Finance to Colorado

BKD has added a Corporate Finance office in Colorado, and Anthony M. Giordano is vice president. He has more than 20 years of experience in mergers and acquisitions and corporate finance.

"Anthony brings a skill set to us in debt and equity financing that will be valuable in Colorado Springs during the credit crunch," said Travis Webb, BKD partner. "Some companies are temporarily struggling with credit, and we are can be an alternative resource."

Giordano said that BKD Corporate Finance handles transactions in a variety of industries, including software, telecommunications, technology and business processing and outsourcing.

"Many baby boomers with family owned businesses are preparing for retirement," Giordano said. "We can assist business owners with confidential succession planning, or recapitalization by private equity groups, to help keep these companies in Colorado Springs."

Commodity prices -- a bubble waiting to burst?

"Although the U.S. economy is having serious difficulties," said Eugenio J. Aleman, senior economist for Wells Fargo, "an actual recession is still a coin toss. We are close, but employment is not collapsing -- something that needs to happen when there is a recession."

But the world economy remains strong. So, U.S. exports and profits from overseas businesses will probably remain strong for the rest of this year, Aleman said.

During the last decade, countries have come into the mainstream world economy -- most notably China and India -- whose people are no longer content with producing and consuming merely for subsistence.

"We are talking about 2.4 billion individuals who need to be fed, clothed, educated, transported, etc. The magnitude of it is unprecedented. So, sit tight and be aware that commodity prices will remain high for the foreseeable future," Aleman said, adding that there is a monetary component to commodity prices.

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