I really enjoy March. First of all, it’s great to get rid of a bunch of snow. That alone makes a person feel better! But the best thing for college basketball fans like myself, is that this month brings March Madness. I don’t know about you, but I love filling out my brackets! I wonder if in my lifetime I will ever get close to a perfect bracket. Realistically, that probably will not happen. There are always some big upsets and a bracket buster somewhere along the way. Fortunately, it’s a lot easier for farm families to create a farm estate plan than it is to pick the perfect NCAA bracket!
I love to watch the basketball teams all season and evaluate their prospects before the tournament starts. But one thing I know for sure, is that I like it even more once the tournament games begin. All the analyzing of games before hand can get exhausting for me. It’ ok to analyze and prepare some things in advance, but if the ball never gets tossed in the air and the game never gets started, then nothing gets decided.
The same can be true for farm estate planning.
I have had the good fortune of speaking to many farm groups over the years. One of the comments that I frequently get is that they wish our session was longer. Now, I really appreciate that comment. (After all, I wonder how many pastors have congregations that wish the sermon was longer!) I think it would be fun to talk longer and more in depth about the issues and possible solutions. Seminars can certainly increase awareness and cause people to rethink their options, but sometimes weighing all the considerations can be overwhelming. Unfortunately, seminars and classes don’t always provide the exact answers for your specific situation.
In our seminars I talk about common farm issues and conflicts, asset ownership, stepped up basis, estate tax laws, wills and trusts, entities and some possible solutions. In addition to the facts, I could fill the hours with stories and examples. In a way it is kind of like a big bracket. You start with all the assets, options, ideas and family members. The question is, how do you fill it all in? Do you study every possible scenario? Often times people get side-tracked on areas that are not important to them or the farm. Do you focus on your goals and try to learn more about what impacts them? What hasn’t been thought through before? Could a big upset really screw up your plan?
What could be a “bracket buster” for your farm?
Could differences arise between your children? Could a divorce create a problem? What about interest rates? Could a lapsing insurance policy have an effect on your strategy? Could bad advice from an advisor create a problem? What about a death “out of order”? What about another change in land prices? Could unrealistic expectations cause a problem? Could an in-law cause a problem? How can each of these potential problems be addressed?
Rather than getting totally diffused and confused I think you should focus on something like your “final four”. What is really important to you? What are the key areas you need to focus on? Here are some possibilities.
Farm Succession Final Four
- Making sure you and your spouse are taken care of.
- Making sure your farming heir can affordably keep the farm together.
- Having a planned/prioritized distribution between the farm heirs and off-farm heirs.
- Keeping the plan simple and understandable.
There can always be a few upsets but keep your focus on the main goals. When you identify your goals, your farm continuation bracket can start to come together piece by piece. So how about you? What would make it into your final four? Are you ready to start filling out your brackets?