Reach into the Farm Journal Legacy Project toolbox to aid with planning.
When preparing for succession, there are tools that can make the process more tactical and less stressful. Tool categories on the Legacy Project website include Estate Planning, Ready for Succession, Leadership Development, Business Continuity, Overcoming Obstacles and Communication. Each tool can be downloaded and printed for your convenience.
Trust/Will Review: This checklist is intended to encourage discussion about trusts and wills. It is meant for discussion purposes only.
Buy-Sell Review: With so many components involved, it makes sense to periodically review your buy-sell agreement. This review tool will help you assess the viability of your current agreement and identify those areas that should be updated. It can also be used to ensure that any new agreement you draft includes (or at least considers) the relevant points, provisions and mechanisms.
Succession Planning Self-Assessment: As you consider your succession planning objectives, responding to these 20 statements will help you identify your priorities and first steps.
Retirement Income and Expenses: Do you know how much retirement will cost you? Do you know if your income will meet your expenses? Financial security depends on an honest assessment of what you’re likely to have and what you expect to need. Use this worksheet to capture your estimated retirement income and expenses.
Establishing a Family Employment Policy: A family employment policy:
- spells out the criteria for hiring and employing family members.
- helps to instill a businesslike environment for all active family members.
- allows managing family members to base decisions on a written policy rather than emotional impulse.
Leadership Skills Inventory: Leadership might be the single biggest gap in a succession plan. Today, the opportunity and obligation to run the operation belongs to the controlling generation. Tomorrow, it may be the next generation or a valued employee. Use this inventory to capture a current assessment of each potential leader’s skills, strengths and areas for growth. The results should serve as the starting point for building a development plan for each individual and a strong leader for tomorrow.
Job Description Template: One aspect of effective succession planning and leadership development is to fit the best candidate to each operational role and ensure that everyone involved is clear about their position’s qualifications and expectations. Non-emotional, objective decisions promote rational, consistent and fair outcomes. Emotion as a motivator is necessary, but it must be tempered with prudent thought in writing.
Merger Candidate Evaluation and Interview Guide: This is a list of business issues
for you to consider when determining the suitability of a potential merger partner.
Assign a numerical value of 1 to 5 (with 5 being the most important) to each item. This
will help to assess the opportunity, based on a consistent set of criteria. Use the interview guide when considering a merger to standardize the process and prompt an informed decision about the
Selecting an Adviser: Selecting an adviser isn’t always easy, but it is very important. We offer a brief interview guide to help you identify an adviser who can facilitate your family’s succession planning process.
Life Insurance and Disability Insurance Needs Analysis: The potential devastation from an
untimely death or disability can be financially devastating to even the most sound operation. Planning for sudden contingencies is critical to your farm’s financial health, your family’s financial security and employee peace of mind.
Ready for Retirement?: It is important that you and your family answer vital questions to determine if the time is right for retirement. This assessment will help you and your family decide if retirement is in the near future.
Fair Versus Equal Exercise: This worksheet is simply a tool for exploration and is intended for conversation purposes only. The decisions surrounding the equal versus fair issue can confound your best intentions.
Family Meeting Agenda: It is extremely important to hold family meetings that include agendas. If an agenda is used, the meeting will seem more structured, will likely be less emotional and will hopefully stay on task. Check out this example of a family meeting agenda.
Goals Clarification Worksheet: Most farmers seem to have a good idea of what they want to achieve when they think about succession. The struggle comes in trying to turn intentions into goals, goals into actions and actions into results. Use this tool to define goals so they can be achieved in a timely fashion.
Conversation Starters: When it’s time to talk about succession, distributing these questions in advance will help each family member consider and then share their succession goals.