As the farm grows and with all the changes that have
happened in ag, there’s more at stake in every decision. The numbers are bigger.
Decisions often have to be made quickly.
Understanding the finances of the farm and making decisions
accordingly will be a key skill for future farm leaders.
We’ve talked with some families who don’t yet have a
succession plan for the farm. Many families know they need to take action, but
are unsure of the best way to start getting the next generation involved in farm
finances and decision-making.
The first step might be realizing that a plan for how to do
this is needed. In one family, the father was a business-savvy farmer. Because
he was so effective, he had been calling all the shots and single-handedly
making financial decisions as he grew the operation.
His sons had been working in the operation, but he wasn’t
involving them in any financial decisions. The father wasn’t interested in
discussing or showing them how he was making decisions, and the more that the
sons asked to be involved in that part of the farm, the more he closed them
The closer he got to the time he was hoping to retire from
farming, the more he became aware of the anxiety his sons were feeling. He began
to realize he needed to catch his sons up to speed on the financial part of
running the farm and let them in on his thinking.
He began intentionally including them in meetings with the
farm’s lender. He had them sit down with him to review the operation’s financial
position each quarter.
Imagine what might have happened if the older generation
hadn’t decided to make this training a priority. What if something tragic
happened to the farm leader?
What if he had retired before transferring his knowledge?
The next generation would have been forced to scramble to pick up the
The father was excited to work on this but felt there was so
much “catching up” to do before he would be able to transfer the operation, so
the family decided to work with an adviser to build the financial and
operational skills of the farm’s next leaders.
Together they worked to get a plan in place that
incorporates training for the next generation in the knowledge and
decision-making skills they will need as they transition to farm leadership.
Most importantly, both generations are on board and willing
to invest the time and attention that’s needed for a plan like this to be
A succession plan that includes training for the younger
generation ensures that the knowledge the older generation has worked their
whole lives to acquire doesn’t disappear with them. It lives on through the next
generation of farm leaders.
When a member of the next generation comes back to the farm,
they often bring a lot of energy and new ideas to the operation.
It can be great to bring in a family member who is
passionate and excited about the future of ag and your family farm. It’s also an
important time to get everyone on the same page about the farm’s strategic
In working with farm families, our legacy advisers get a
unique perspective on the expectations that are set up — or neglected — during
When bringing in a family member, it’s important to think
about where the farm is headed, and what types of skills the next generation is
going to need in the future.
Key things to consider are: What does the new employee
bring? What are they most interested in and passionate about in the operation?
Do they bring new skills or ones that complement those of
other family members or employees already on the farm?
Families need to be clear about expectations with members of
the next generation who want to work on the farm.
There needs to be a match between the farm’s needs and the
skills brought by the family member. Otherwise, confusion reigns.
Also, the new employee needs to know what his or her role
will be. They will ask: “Where do I fit in?”
As more young people are interested in coming back to the
farm, it may help to create job descriptions for your operation.
Think about what the next generation has to offer and, most
importantly, how it fits with the future of your farm. When there’s a match, you
have a great candidate on your hands.