December 29, 2016
Farmers as a group are extremely wealthy—at least with the assets they own.
Think about it: if you own a combine, you own a $200,000-$300,000 machine. And if you own a quarter of land, you own half a million to a million dollar's worth of agricultural real estate. Once you own a quarter of land, you’re pretty much automatically in the 1% or 2% of most wealthy U.S. individuals.
At least on paper (though that may not translate to cash), farmers are wealthy. Many are understandably concerned about passing those assets down and not having the next generation ruin the business. Some don’t even let their kids make business decisions until they’re almost completely out of the picture, which might not be until they’re in their 80s.
There are two really good stories from The Richest Man in Babylon that deal with the concept of inheritance. I think they hold a lot of wisdom for farmers and landowners today.
Story #1: Goodbye and good luck, my son
This is the story I described in part two of this series. A certain father sent his son away for 10 years with a clear rule: if he came back broke, his father would donate all his assets to the church. But if he became a hard-working man, his father would hand over his “keys” and leave his son in charge of his own business and wealth.
The kid found himself broke, having lost his gold, but out of desperation he read the five laws of gold that his father had written on a tablet. He put the laws into practice and came back extremely wealthy. For the bag of gold he’d been given, he repaid his father five times.
Story #2: The luckiest man in Babylon
Story #1 is a bit hard to translate to modern life. You can’t really kick your kids out for years and force them to make it or break it. But the second story is probably closer to what you should do. It’s one of my favorite stories in the book, the very last one in the volume. The title is “The Luckiest Man in Babylon.”
An older gentleman was riding across the desert in a caravan with all his merchandise. He rode with the grandson of his recently passed business partner. When he looked over, he saw a cocky kid with jewelry and fancy robes. The grandfather had been well-respected, while the father was one of those men who spent all the money that came in. The kid was well on his way to following in his father’s footsteps.
The old business partner saw an opportunity to help the young man. He said, “Would you like to learn how your grandfather and I became partners?”
“No,” the young man said. “I just want to make money.” Yet, something happened that allowed the old man to tell his story anyway.
They were coming up to Babylon and saw farmers. The old partner knew the slaves, and knew they had been farming there for 40 years. The kid asked how he knew, and he said he knew because he was shackled as a slave himself 40 years ago.
He had become a slave unfairly and bounced around to a handful of cruel owners. In the midst of his misfortune, another slave he was chained to told him, “Hard work is the best friend I’ve ever known. You work hard, you’ll get recognized, and you’ll progress.”
Eventually, the business partner met the kid’s grandfather, who was also a slave. When the kid learned his grandfather had been a slave, he could hardly believe it. How could it be so? His grandfather had been so well-respected by all!
But he’d bought himself out of slavery by working hard; his work ethic was what led to respectability.
Later, the partner was transferred to the most brutal slave owner he’d ever had. But on the second day, the kid’s grandfather showed up and bought him out of slavery. They became business partners and became extremely successful because of how hard they both worked.
By the end of the story, the kid had done a total 180 in his thinking. He took off his jewelry and started being respectful to everyone around. His life was changed forever.
Story #2 reveals a better way to onboard the next farm generation. You may not want to throw them to the wolves for 10 years. Probably, the best alternative is coaching them along and introducing them to your mentors and the people who brought you along.
The relationship between parents and children can be filled with strife and tension. The kid will never be smarter than the dad, in the dad’s eyes, and vice versa.
It’s hard to be a mentor to your own children; sometimes it’s better to introduce them to other mentors that can impact them.
I strongly recommend reading The Richest Man in Babylon or listening to it once a year. It’s so valuable, and it’ll change your perspective on making money, spending it, and on how to handle your family.
You’re riding on your combine all day anyway. Why not listen to material that will change your life while you’re at it?
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