Passing down the farm is a many faceted equation, and because it is unlikely that you have already been through it recently, it will require you to ask for help from those likely to know more than you. It includes elements of strategic planning, farm succession planning, and farm estate planning. Are you willing to set your ego aside and ask for help or not?
Farmers need to look at what’s working and what’s not in order to better understand which past, present, and future actions are the most likely to take their farm in the direction they want it to go. Add to that the creation of policies, practices, training, tactics, and actions that will result in your next generation being able to lead and manage the farm in the future. And putting it all together with the documents required to add the force of law necessary to ensure it all happens.
It goes without saying that no one knows all that needs knowing on their own, enough to cobble together all these elements in an overall process that will result in the seamless transition of your farm over the years to the next generation.
The $64,000 question, “Who should I ask for help?”
Here are three groups of individuals you should consider when reaching out to get the insights you’ll need in order to make the choices only you can make.
Your Family:
In the final analysis the entire passing down the farm process is for the benefit of your family. In most cases farms that successfully go through the process end up redesigning the ownership of their farm business in order to address what’s important to the family. So, why don’t you ask your family for help – not technical advice, but help in the context of sharing what’s important to them and what they hope the future holds. It is especially important to get their wishes out in the open. They will probably not be burdened with the knowledge of how easy or hard to accomplish their objectives are – that’s what your advisors are for, what you want from your family is help opening up the stream of communications required to end up with something everybody wants.
Your Advisors:
During the early stages of the process you are not really looking for a diagnosis or treatment. You are really looking for processionals who are team players – willing to work together for your benefit instead of their own. If you are free to bounce ideas off of them as the process develops you can latch onto what might work as part of the plan and what clearly won’t. Each discussion builds on the last so in the end there will simply be an common opinion of what they should do to put it all in place for you. And because this is a long, never ending process – there will be no “job done” celebration. There will be a growing consensus on the next step and the next and the next.
Your Peers:
A vital group is composed of successful farmers you know and trust – maybe you don’t even know all of them that well when the peer group is formed, but everyone chosen will be someone with your best interests at heart. Let’s assume your peer group contains six farmers from different parts of the country. Each of you has your own circles of friends, acquaintances, and neighbors – so multiply everyone’s first-hand experiences by 10, 20, 30, or more. Imagine the insights present when you meet! These peers will not only ask you questions, testing your assumptions of what’s true and what’s not – they will be able to reach out to those they know who have shared with them what’s working and what’s not.
And when your peer group consists of members both older and younger than you – even from different generations, their points of view may make it easier to understand your parents motives, your siblings concerns, and your children’s perspectives.
Finally, passing down the farm is an evolving process. These important constituents, groups of confidants, will be able to shed light today, as well as in the future.
Be willing to ask for help when entering the farm succession – passing down the farm process, then paying heed to the insights offered because they are a vital ongoing part of the process.
And speaking of getting help, here are some articles – they are about estate planning – that are also relevant to your efforts at succession and planning. As you already know on the farm everything is connected to everything else so these articles, at least some of them, will be on target for you.
- Estate Planning: Are You Ready When Your Time Comes? – My close call with death last week instantly had me thinking… is my family ready in case I bite the big one? (By the way, I never understood that expression – what are you biting exactly?) I have a small family just my wife and Jake, …
- Two Important Uses of Life Insurance in Estate Planning … – Life insurance plays a vital role in estate planning. This article uses examples to discuss common functions of life insurance in two different estate planning contexts. #1 Insurance proceeds support survivors if a support provider dies …
- How Much Life Insurance Do You Need? – This is a guest post by Neal Frankle. Neal found himself in a financially fragile situation at the age of 17. Both his parents passed away while he was still in high school, leaving behind a small insurance settlement. …
- When Was Your Last Financial Checkup – Like our health, many of us take our finances for granted. I know I do. But every once and awhile we should do a financial checkup to make sure everything is running as smoothly as we think it should be. …
- 2009 Traditional and Roth IRA Contribution Limits – 2009 is here, which means it’s time to start planning your retirement contributions. Even though 2008 is over and done with, you can still contribute to your 2008 IRA until April 15, 2009. You can contribute to your 2009 IRA any time …
If you are serious about farm succession, or if you are a professional involved in farm succession planning – or an farm association executive, you are in the right place!
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Farm Succession – The 7 Keys to Successfully Passing Down The Farm to The Next Generation | Farm Succession - Passing Down the Farm // Aug 10, 2009 at 5:11 pm
[...] You must be willing to ask for help and then accept it. For many of us this is the hard part. I always hesitate to ask for help (advice) unless I am committed in advance to go along with it. It would embarrass me and the person I asked if I just blew off their advice, the advice I had asked for. What works is when a group of peers, outsiders with no ax to grind are part of a continuing dialogue – a series of strategic conversations. Then it’s not about a single person’s insights but a collective back and forth around what has worked and what hasn’t for them. [...]