When you ask good questions, sometimes you understand the issues better.
There is a lot to think about as you consider a farm business transition. At the heart of the process is your goals and dreams for the business, your family and yourself. There are lots of great questions you need to answer to be ready for success. Here are a few:
1. Is the farm, in its current format, generating enough income to support an additional family?
2. If not, are there farm income expansion possibilities or viable off-farm income possibilities available to support the entering family?
3. Is there a way to transfer the farm and keep everyone in the family happy? This includes exiting and entering families as well as non-farm heirs and in-laws.
4. Can the parents afford to give some financial assistance to the entering family while still maintaining an adequate retirement income?
If you can answer "Yes" to nearly all of these questions, you should look for my next blog and a few more questions. If you answered "No" to any question, you may wish to evaluate the situation before you proceed.
In some cases, you will need the help of trusted advisors to answer these questions. It's another reminder of the value of fee-only, fiduciary financial planning advice during this process.
If this article has you thinking about your own circumstances, contact my office at firstname.lastname@example.org.
The opinions of the author are not necessarily those of Farm Futures or Penton Agriculture.