“If you never make it home tonight, are your affairs in order?” asked Ron Hanson, Ph.D., University of Nebraska-Lincoln Harlan Agribusiness Professor Emeritus.
During Wednesday’s Farm Legacy Seminar in Champaign hosted by COUNTRY Financial and Illinois Farm Bureau, Hanson challenged attendees to plan for the “what if.”
“More than 80% of family farm owners wish to keep their farm in the family for future generations,” said Hanson. “But less than 20% have a plan to accomplish that.”
So, how do you get started on a contingency plan? And how do you divide the farm fairly and equitably, not equally? Hanson stressed that having a family meeting is the first step.
“It’s your obligation to make sure that you sit down with all your children, and begin talking and discussing,” explained Hanson. “Give everyone a chance in the family to share their feelings openly and objectively.”
At an initial meeting, families may want to draft a plan that outlines their vision and goals for the farm.
Next, the parents or family should put together a management team that includes an accountant, attorney, farm agricultural lender and estate planning specialist.
Throughout the process, families should maintain open and honest communication, which will promote trust and respect. “No one ever likes being surprised when it comes to a family estate or a family will,” noted Hanson.
It’s also important for parents to not only help their children build equity but also enjoy their retirement.
“You’ve got to put your children in a financial position that someday they can take over and be financially successful,” said Hanson. “But also remember to enjoy the later years of your life. You are not going to take your estate to heaven.”
Kris Kline, financial specialist at COUNTRY financial, discussed how COUNTRY can assist with legacy planning. “We can do a full estate plan for you, a full farm succession plan...” explained Kline. “We can sit in on meetings with your CPA and attorney and talk to them about your issues and see where we can come up with solutions.”
Kline encouraged attendees to take the first step by reaching out to their local COUNTRY representative.
Overall, Hanson commended farm families for their perseverance and way of life. “Be very proud of what you have and what you’ve accomplished,” praised Hanson. “Farm family relationships are priceless. Farms can be replaced, families cannot.”
For more information on farm legacy planning, visit Passing on the Farm.