How do you approach transition planning when two of your children are on the farm and one is not? You must be intentional and communicate, says Steve Henry.
Along with his wife, Laurie, Henry has two sons as partners in their row crop farm in Nevada, Iowa. They knew early on they needed to keep their off-farm son informed about the future of the operation.
“When you have both on-farm and off-farm heirs, it is easy be confused if you are an off-farm heir and to think you are not as valued,” says Henry, 2021 Top Producer of the Year winner. “You don’t want misunderstanding to grow into conflict.”
BUILD FAMILY TRUST
This approach will help head off numerous challenges for the farm and family, says Rena Striegel, president of Transition Point Business Advisors.
“When transitioning, off-farm heirs can get really anxious if they don’t have trust and confidence with on-farm heirs,” she says. “The off-farm heirs are sometimes just as passionate about the farm. I’ve also heard from plenty of off-farm heirs who have plans to go home at some point to the farm.”
Questions for Off-Farm Heirs
Tension between on-farm and off-farm heirs can surface when expectations and boundaries are not clear, says Rena Striegel of Transition Point Business Advisors. To assess where expectations are not aligned, she provides this questionnaire tool for your off-farm heirs:
- Are you interested in keeping the farm in the family for the next generation? Why or why not?
- Are you willing to participate in the management of the operation? (This can include landlord/tenant relations, financial management of the farm, hiring/managing contractors, etc.)
- Would you be willing to participate in quarterly farm meetings?
- How important is earning farm income to your personal financial portfolio/well-being in the future?
- Would you be willing to visit the farm twice a year to ensure the land is being cared for and to visit with tenant(s), contractors and conservation agencies?
- Would you be willing to forego a percentage of income to ensure the land was being farmed sustainably?
- Do you have any concerns regarding making decisions with your family members, elders and/or your generation?
- Tell me what the farm means to you.
For more succession planning tools, check out the DIRTT Project from Transition Point Business Advisors.
Take Control Of Your Succession Plan at the Top Producer Summit!
Date: Monday, January 23, 2023
Time: 8:30 am - 4:30 pm
Cost: $219
Use the topics and tools included in The DIRTT Project to jump-start the succession planning process for your operation whether you are just beginning or need to get on track.
- Learn how to set goals for both the transitioning owners and the operation.
- Learn how to create a plan to ensure that your heirs and successors are ready to lead and work effectively together.
- Learn how to address family disharmony or handle communication with successors who do not get along.
- Learn how to choose your professional team and hold them accountable for the work they will be doing for you.
- Network with and learn from other farmers in transition.
If you are in the process of succession planning, be sure to check out the tools Farm Journal offers. To learn more, visit FarmJournalLegacyProject.com
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