For many farm families, succession planning is viewed as something that happens near retirement. The conversation often gets pushed down the road until an owner is ready to slow down, health concerns arise or the next generation starts asking questions about the future.
But according to Rena Striegel, president of Transition Point, that’s one of the biggest mistakes farm families can make.
Speaking during Farm Journal’s Next Generation Farming Week, Striegel says successful farm transitions rarely happen quickly. Instead, they are often the result of years of preparation, communication and intentional decision-making by both generations.
“The next generation really needs to be thinking about what sort of resources they’re going to need for their families to be able to continue that farming legacy,” Striegel says. “But they also need to think about what they need to learn or understand in order to be prepared to become a business owner rather than just a farm operator.”
That distinction is becoming increasingly important as farm businesses grow larger, more capital intensive and more complex. While many young farmers are eager to return to the operation and eventually own part of the business, Striegel says ownership requires a much different skill set than simply running equipment or managing day-to-day tasks.
“Sometimes there’s such a high drive for that ownership and control piece of it that they’re sort of skipping over the learning curve that has to happen to be able to step up into that clear decision-making, high-risk ownership seat,” she says.
In other words, a successful transition is about much more than transferring land, equipment and assets. It also requires preparing the next generation to make difficult business decisions, manage risk and lead an operation through changing market conditions.
The First Succession Conversation May Happen Earlier Than You Think
When asked when transition planning should begin, Striegel says many families focus too much on age and not enough on interest.
Rather than waiting until a son or daughter returns to the farm full-time, she says the conversation should begin as soon as a young family member starts expressing serious interest in agriculture as a career.
“When kids are on the farm and are really expressing a high desire or high interest in that farm business, that would be the first sort of trigger point for a family to be talking about how do we want to position the opportunity for a career here,” she says.
Those early discussions can help families establish expectations before major life decisions are made.
Families can begin talking about compensation, benefits, educational goals, work experience outside the farm and what a future role within the operation could look like. Even if ownership is decades away, having those conversations early can create a roadmap for the future.
“So thinking about how would we compensate them, what benefits they would get, what expectations do we have of them to work away or get an education, or are we just going to let them transition straight from high involvement as a high schooler into a career path?” Striegel says.
Those discussions may seem premature to some families, but Striegel says they create clarity and help avoid misunderstandings later.
“It really can start extremely early in terms of thinking about what you would like succession to eventually look like,” she says.
Learning From Past Generations
One of the most unique transitions Striegel has worked on involved a pair of siblings who took over ownership and operational control of a large farming operation at just 28 and 31 years old.
While that timeline may sound unusually aggressive, she says it didn’t happen overnight.
“We were able to do a full transition of ownership and control of all operational decisions at that point, but we had been working on that transition for 10 years,” Striegel says.
The family had a strong motivation for starting early. The previous generation had experienced a difficult succession process that created uncertainty and frustration, and the parents were determined not to repeat those mistakes.
“We walked into that family having already had sort of a succession mishap in the generation prior to that,” Striegel explains. “It was a very rocky, very unclear transition.”
That experience shaped the family’s approach.
“The parents were like, ‘We don’t want that experience for our children,’” she says. “They had heard enough horror stories and they didn’t want to be a roadblock to them. They wanted them to be able to experience running this business while they were still young enough and energetic enough to have a passion and enthusiasm for it.”
The transition process began while the successors were still attending college and living at home. Over the next decade, responsibilities gradually shifted, knowledge was transferred and a plan was executed.
Ultimately, the family achieved its goal of transferring ownership and management before the parents reached age 60.
Why Waiting Often Creates More Problems
Despite the benefits of planning ahead, Striegel says many families continue delaying transition conversations because they are uncomfortable.
Unfortunately, she says postponing those discussions often makes them even more difficult.
“These conversations, obviously, the longer you put them off, the more emotion and tension that we get around them,” she says.
That’s because uncertainty tends to grow over time. The older generation may become concerned about retirement income, fairness among heirs or giving up control. Meanwhile, the next generation may begin questioning whether a future exists for them within the operation.
As years pass without a clear plan, assumptions can replace communication.
For younger family members, that uncertainty can eventually impact major life decisions.
“They don’t want to wait until it becomes such a high-pressing need to know right now so they can make decisions about their life,” Striegel says.
Questions about where to live, whether to return to the farm, how much debt to take on or whether to pursue opportunities elsewhere often depend on understanding the future of the family business.
Start Small Rather Than Waiting for the Perfect Conversation
One misconception Striegel frequently encounters is the belief that families need to have every answer before discussing succession.
Instead, she encourages families to simply start talking.
“You don’t have to sit down and hash it out all in one conversation,” she says.
Beginning with smaller, lower-risk discussions can help family members become more comfortable sharing goals, concerns and expectations.
For the transitioning generation, those conversations can help them begin envisioning life after stepping away from day-to-day management.
“It helps you get your mind wrapped around the fact that a transition is coming,” Striegel says. “You start thinking about what that next stage of life is going to look like for you and how you want to participate in the lives of your successors, your grandchildren and how you want to interface with your business.”
For the next generation, early discussions create an opportunity to learn, ask questions and better understand the owner’s long-term vision before major decisions need to be made.
“We want to be stepping into those things when it’s low risk and things are calm and we’re just seeking to understand,” she says. “Not when we have to have a decision within the next month or two or we’re going to feel like we need to look for other options.”
Building a Legacy That Lasts
As farmland values remain elevated and agricultural operations become increasingly complex, successful succession planning is becoming one of the most important business conversations a family can have.
For Striegel, the families that navigate transition most successfully aren’t necessarily the ones with the most resources. They’re often the ones willing to start early and communicate openly.
“The goal is always to make it as low-risk and low-emotion as possible,” she says. “And so the earlier we can get that started, the better it is for everybody.”
For farm families hoping to preserve a legacy for another generation, that first conversation may be the most important step of all.
