You’ve got the time. You’ve got the desire. And you’ve got a few extra bucks to spend. Starting a business in retirement sounds like a piece of cake.

Don’t be lulled into a false sense of security. There are many ways to trip yourself up. And the downside isn’t just a failed business; it’s a failed retirement.

If you want to know these traps before you fall into them, take a look at what these entrepreneurs reveal about the mistakes retirees most often make when starting a new business.

Mistake #1: Taking too much risk

This is a big one. It’s the most misunderstood aspect of starting a new business. Entrepreneurs don’t take risks; they take calculated risks. Quite frankly, you don’t have the runway length to land safely if you place too big a bet in your retirement years.

“The worst thing a 50+ person interested in a small side business can do is to take too much risk, particularly for something they are unprepared for,” says James Connolly, Co-Founder and CEO of Villa Homes in San Francisco. “It’s important to continue investing for retirement (at 50, or even 60 or 70, there’s still hopefully a long time horizon ahead) while having an appropriate margin of safety to protect savings.”

It’s probably a good idea to think of starting a new business at this stage in your life as a gamble. It doesn’t mean you won’t be successful. There are plenty of examples of successful entrepreneurs who started new businesses in their 50s, 60s or even their 70s. Nonetheless, you should treat this the same way you do when you enter a casino. Know how much money you can afford to lose, and pull the plug once you hit that mark.

“One thing you must not do is risk your retirement nest egg on risky business ventures,” says Lamar Brabham, CEO and Founder of Noel Taylor Agency in North Myrtle Beach, South Carolina. “By definition, all business ventures carry a certain amount of risk. Don’t ever risk more than you are willing to lose. Most small businesses fail, and you don’t want to ‘have’ to go back to work because things didn’t work out. Plan for the worst and hope for the best.”

Mistake #2: Choosing a business you have no experience in

Speaking of money, one of the biggest start-up gimmicks is to convince naïve entrepreneur wannabes to “buy” a preformatted business template they can just add water to and—voilà—instant business.

Nope. That’s a scam. Denis Litvinov, Co-founder of FunCorp and CEO at Yepp, based in Limassol, Cyprus, says this is a mistake of “investing a lot of money upfront before really trying out the new endeavor.”

But even if you’re not investing money, entering a business where you have no experience can lead to problems.

“One of the biggest mistakes we see people making in retirement is starting a business in an area in which they have no expertise,” says Gerald Grant III, Financial Advisor at Equitable Advisors in Miami. “For example, they may want to open a local retail store or purchase rental properties and end up losing funds because they don’t have enough experience in those businesses. One way to do it successfully is to partner with or work for someone in those areas to gain experience prior to doing it on your own.”

Mistake #3: Doing it just for the money

On the other hand, placing money as a priority might lead to a different kind of problem.

“Another mistake we see retirees make is doing it just for the income,” says Grant. “It’s important to make sure whatever you invest in, you have a passion for and a reason why you’re doing it that’s greater than just making money. Often, retirees underestimate the level of involvement associated with small businesses. Many think they can start a small business and the income will just come flowing in without much work involved, and unfortunately, that is not your typical outcome. These opportunities can be very demanding and hands-on, which is often the opposite of how most retirees envision their retirement.”

Mistake #4: Failing to plan

This leads to a bigger question. It’s not just “why” you’re doing it but “how” you’re going to do it. This implies you need to think ahead. And you know what they say about “failing to plan.” It means you’re “planning to fail.”

Don’t plan to fail. Take advantage of the time you have to really think about what you’re going to do.

“Start working on your retirement game plan as soon as possible before you blow up your savings,” says Sam Willis, Founder of Raincatcher in Denver. “You will have a lot of extra time on your hands, and now it’s on you how to utilize it. Do not let your skills go to waste.”

The alternative is getting caught with an unpleasant surprise. This is where the advice of experienced entrepreneurs can really come in handy.

“One of the worst things a retiree interested in starting a small side business can do is not have a plan,” says Shawn Manaher, a former financial advisor who founded 5 online businesses and is a coach, speaker, podcast host, and author based in New York City. “Having a solid plan is what can help you keep moving forward when things get hard. As a rule of thumb, here’s what I recommend when getting started:

• First, start coming up with a list of business ideas from which you can create extra income. Think through what you are passionate about or what type of skill sets you have.
• Once you have an idea of what you want to do, start researching the market. What are the different ways that people make money? How can you set yourself apart from the competition?
• Next, start putting together a plan. How will you start to receive leads? What will be your monthly, quarterly and yearly goals?
• Finally, go out and take action! Don’t be afraid to start small and grow your business over time. With a little hard work and dedication, there’s no limit to what you can achieve.”

Mistake #5: Forgetting business success comes down to marketing

Here’s a faux pas aspiring entrepreneurs make all the time regardless of their age. The genesis of this error generally comes from an overabundance of technical enthusiasm. Entrepreneurs often focus so much on engineering the product they forget the essential reality of all businesses.

“The classic is to get a coaching qualification and then start up as a coach without learning about marketing,” says Victoria Tomlinson, Chief Executive at Next-Up in Harrogate, UK. “In fact, I would say that is generally the biggest mistake people can make. It is ridiculous, but a lot of people still look down on selling and marketing. Of course, you can never be successful if you don’t market and sell!”

Mistake #6: Using your entire retirement savings

Here’s where you’re doubling your risk. A business failure not only loses you your business, but it can also lose you your retirement.

“The worst thing a retiree can do is use their retirement assets, like their 401(k), to start a business,” says Chuck Czajka, Founder of Macro Money Concepts in Stuart, Florida. “Starting a business comes with a certain degree of risk, but that doesn’t mean risking your retirement savings.”

Liz Miller, Director of Communications at GetSetUp in San Francisco, says it’s best not to “invest all your savings into a small business. It is best to ensure you have the money you need to survive in retirement kept safely away and use additional discretionary funds to invest and start to grow your small business.”

Again, to return to the casino metaphor, it’s not that you can’t use any of your retirement savings (assuming it’s sizable enough), it’s just knowing how much you can safely risk.

“Do not use a large portion (or all) of your retirement funds, no matter how certain you believe your new business idea is,” says Levon L. Galstyan, Certified Public Accountant at Oak View Law Group in Glendale, California. “Over 50% of new businesses fail for reasons beyond the owners’ control. Only spend a small portion of your retirement savings and be prepared to lose it all. You may not lose it, but you must be financially secure if you do.”

Mistake #7: Obtaining a 401(k) loan (or any other loan)

And while the lure is there to use that pot of untapped potential in your retirement plan, you need to be careful how you use it.

“Cashing out your retirement accounts to start a business without a backstop can be disastrous for someone close to retirement,” says Amy Greene LoCascio, Principal and Managing Partner at Eamon Capital Management in Pittsburgh. “Anyone within ten years of retirement needs to make sure the money that they are investing in an entrepreneurial business is ancillary to what they need to retire, or need for retirement income.”

You might be tempted to think a 401(k) loan is the easiest way to access your retirement fund (assuming the plan allows it). But that’s not the only way.

“There are better ways to access your retirement funds for a business startup, such as a 401(k) ROBS rollover, than borrowing against your 401(k),” says Galstyan.

When you get right down to it, however, any loan presents risks far too high for someone in retirement. If this side hustle idea requires that kind of financing, the idea might be too big for you to entertain. You might want to reconsider and take on a smaller project. At least at first.

“It is preferable not to begin your business with borrowed funds,” says Galstyan. “A better strategy is to start small with your financial resources and gradually grow your company by reinvesting profits.”

So, there you have it. Seven deadly sins to avoid when starting a side hustle in your retirement.

But this is just the tip of the iceberg. You may have other new business questions. Not to worry. There are plenty of (free) resources you can access to answer those questions.