As the economy worsens, some people are beginning to feel lucky. Really lucky, if you can believe this new trend — tapping retirement accounts and other personal piggy banks in order to start a business. It’s a trend that has some upsides as well as plenty of downsides. Before you begin thinking that we’re out to get you, you might want to actually think about things from a more balanced perspective.

First and foremost, you need to make sure that you’re definitely aware of all of the ways that a retirement account can actually get you to your goals. Do you really want to risk your work-free years if your business doesn’t pan out the way you would like?

In addition, you have to realize that you’re going to be paying taxes as well as penalties for tapping a retirement account before you’re old enough to actually retire. If you’re not at least 59 1/2 years old when you file for your withdrawal, you’re going to be hit with a penalty as well as having to pay income tax on the amount. That really cuts into your nest egg as well, and it can be difficult to replace the money once you take it out.

Taking out a loan can be just as rough — if you miss a payment for any reason, it’ll be treated like a withdrawal and you’ll have to do the tax-and-penalty shuffle all over again.

If you’re going to take on the task of running a business, you want to make absolutely sure that this is what you want to do. That means that you need to know something about well, running a business. There is a non-profit organization called SCORE that works directly with entrepreneurs looking to start a business. You’ll have a wealth of information here, so don’t overlook resources like that. In addition, if you can form informal groups with other entrepreneurs you’ll be able to get things done in a big way. That’s because you’ll have the motivation to push forward even when you feel like giving up, and that can definitely help you in those negative moments.

Market research also makes a strong difference in terms of whether or not you’re going to actually be able to get things done. The last thing that you want to do is find yourself being able to get anything done because you’re always running from idea to idea without even testing whether or not they’re going to work. Don’t just listen to friends that think your idea for a toy delivery service is going to take off — actually take it to the next level by doing your own testing of the market you want to enter. Talk with people that are already in that market. You might think that current business people won’t talk to you because you’re competition, but this couldn’t be farther from the case. You’re going to really want to make sure that you’re as honest and upfront as you can be, because there’s really no reason not to be, if you ask us.

All of these points fail to cover the other side of life — family and friends, of course. It goes without saying that you’re going to want to make sure that you aren’t carrying a lot of debt, and that you have a budget that you can live with. There’s just not getting around the fact that you’re going to need a lot of money to get your business dreams off the ground. If that money doesn’t come from a loan or your savings, it’s going to come from other sources. Make sure that you’re not sacrificing quality of life for your life. If you are married, it never hurts to make absolutely sure that your spouse is on your side. Running a new business is a matter of very long hours and more than just a little stress. People that start out positive in the beginning can get overwhelmed when they realize just how much work you’re going to have to do. Until you make the company profitable, you’re going to find yourself essentially working at another job — the very thing that you entered retirement in order to avoid. We’re not trying to talk you out of your dreams at all — but you need to make sure that you have them in perspective compared to the rest of your life.

Overall, building a business in retirement is what you make of it. It’s something that definitely has its fair share of risks, and understanding those risks will help make sure that your quality of life doesn’t suffer just because you want to start a business — make sure that you think things over and then take action!  You only get one life to live your dreams, you know!