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Corn+Soybean Digest

Retirement Income Sources

Wow! Since graduation, my schedule has been hectic doing banker and producer seminars all over the west coast.

Point for Perspective

Never ask your parents when they will retire from the business. Most will respond that they will never want to retire. Ask when they will be financially independent, and you will get a whole different response.

Point to discuss: Where is their income stream going to be generated?

  • Social Security

  • Pension

  • 401K, IRA, SEP’s or Canada RRSP’s

  • Working

  • Sale of farm

  • Lease of farm

  • Gifts or inheritance

Facts

93% of farm and ranch managers’ retirement income comes from the sale or lease of the farm.

Many don’t have social security because they had farm income losses due to tax strategy.

33% of all Americans must work during retirement. A real bummer!

A retired couple will need $150,000 of equity for each $12,000 of living expenses or earnings in retirement.

Recommendations to younger farmers

Set aside five to ten percent of your net earnings in retirement programs and invest outside of agriculture.

Sports View

Will Sammy Sosa continue his hot homerun pace? I hope so – I like Sammy!

The Sacramento Kings are my favorite of the playoff teams, followed by the Detroit Pistons. Rick Carlisle, their coach, played B-ball for Virginia and he went to high school in Northern New York, where I grew up!

My e-mail address is:sullylab@vt.edu

Editors' note: Dave Kohl, Soybean Digest Trends Editor, is an ag economist at Virginia Tech. He recently completed a sabbatical working with the Royal Bank of Canada. He is now back at Virginia Tech with his academic appointment, which is teaching, extension, and applied research.

To see Dave Kohl's previous road warrior adventures type Dave Kohl in the Search blank at the top of the page.

This online exclusive is brought to you by Soybean Digest

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