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The Rewards of Retirement

July 5, 2011
dells retire
Now that he’s retired from farming, Roger Dell enjoys boating.  
 
 

There’s nothing wrong with hanging up your boots. 

These days, Roger Dell is more likely to wear a pair of boat shoes than work boots. The hand that once negotiated the turn rows of his Westminster, Md., farm now guides a 48' sportfishing boat about the estuaries of Chesapeake Bay. The scent of saltwater, in his opinion, is a worthy replacement for the first whiff of freshly turned soil.

Last year, the 62-year-old Dell decided it was finally time. Neither of his children were interested in returning to farm. However, his partner and brother, Greg, had three sons living on the farm and some of his children were already showing interest.

"Farming is and has been very important to me, but I made my mind up a long time ago that I wasn’t going to let it be everything," Roger says.

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Financial security. To help prepare for the future, Farm Journal succession planning expert Kevin Spafford and his team complete a financial needs analysis of all active family members.

"This exercise is especially important for the senior generation, which may be transitioning out," Spafford says. Addressing financial security includes looking at business and nonbusiness assets and comparing projected financial obligations against projected personal financial resources.

"For Roger, we determined what value he needed to derive from the business to reach his goals," Spafford says. "We then isolated the business assets and determined a 20-year payout that will provide Roger and his wife, Deanna, enough income to bridge the gap without compromising the integrity of the farm operation."

In negotiating an equitable settlement, the Dell brothers faced a situation common when one partner retires. A one-time cash buyout would not only have put the farm on tough financial footing but also have tax implications for Roger.

"I was exiting the farm to make room for more people, not to put added stress on it," he says.

To sidestep the issue, it was decided that Roger would receive an annual note payment and an hourly wage for working on the farm. He pays for his own medical insurance. Although having health insurance provided by the farm sounds good to a retiree, promising to cover Roger for life would have been an open obligation to the farm operation.

Since Roger’s payout is spread over two decades, Spafford also evaluated the life insurance holdings of all the Dells to protect both brothers. The family knows too well that the unexpected can happen.

In September 2010, Tommy Dell, a third-generation partner and Greg’s son, was killed in a farm

accident. Roger says Tommy’s death has given him plenty of reason to pause and consider what’s important in life.

"I’ve been at the farm more than I might have been otherwise, but it’s purely in an advisory role. We miss Tommy and his abilities, but everyone is stepping up to make the farm function," Roger says.

Sibling differences. Greg couldn’t be more different when it comes to retirement. "Roger is probably the smart one," Greg jokes. "Farming is my job, my hobby and my life. My kids all live within a few miles of me and this is what I do."

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FEATURED IN: Legacy Project - Legacy Project 2011 Report

 
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