despair

Critical State – Disability or Loss of Life

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Frequently over the next several weeks, we will delve further into the many factors that can lead your business to a “Critical State.” To refresh your memory, one reaches critical state when at the point of significant change. The significant change can lead to a state that will have a profound effect on you, your family, or your business. Thus the term “critical.”

Disability or Loss of Life: whether it be one of the major stakeholders in your business, a member of your family, or one of your employees, this is often the most catastrophic change.

Although disability is not guaranteed to happen, the end of one’s life is certain. Arguments have been made as to which is more difficult to manage through. I have experienced both in my family.

What is your strategy, your back-up plan, if someone in your family or your business suddenly became disabled or was killed? How would you continue? Who else knows what that person knows so that the only hardship you must deal with is the emotional one?

  1. Financial: if control rests with only one person, everything financial is instantly in limbo if that person passed away. Secondary signors can be established. Power of attorney should be in place (applies during disability.) Something as simple as writing down account numbers and passwords in a notebook stored in a locked safe can be incredibly beneficial to those who are left behind, struggling to carry on while dealing with their grief.
  2. Operational: “Were those peas on the west half sprayed? When? With what?” A crop could be lost, and subsequently a farm could be lost, if important operational information is not recorded and readily available if/when the person with that knowledge in his/her head is hurt or worse. The importance of managing your business information has been raised here on many occasions.
    What about grain deliveries? Who authorized those holidays for the staff? Etc…
  3. Personal: too often, major crises such as death or disability can lead to a personal “critical state.” Relationships break down under the stress, families fighting on the way to the funeral home, etc. Conversations with family, a current and well prepared will, and preparations for crisis are all required to bring everything back down from “critical state.”

Direct Questions

Do you have a will, and is it current?

Health care directives (also known as living wills), financial power of attorney, and final wishes should all be laid out so that the decisions are not left to those left behind. These are your decisions and the appropriate legal documents allow you to have some control while you’re not able to take control. Have you put these in place, and if not, why not?

 

Early on in most new business engagements, I ask about wills, powers of attorney, life and disability insurances, etc. The answers are as varied as the people I work with. Most have these fundamental pieces in place, and many more have already begun some very intriguing and creative ways to facilitate business succession. From Joint Ventures, to funded buy-sell agreements, to estate freezes, and share purchase plans, there is no right or wrong way to plan, only a series of possibilities that can be “more right” than some others.

I celebrate the plans that are already enacted, and push hard on those who have none.

From the Home Quarter

Not taking action to plan for the inevitable does not delay the inevitable, it only creates extra hardship for those left behind.

 

toe the line of critical state

Critical State

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Critical State…it’s a subjective term, but is often defined in science literature as “the point at which something triggers a change in the basic nature or character of the object or group.” To paraphrase: something can be referred to as being in a critical state when at the point of significant change.

How many triggers of change do you, your family, and your business face each day, each month, and each year that could cause significant change? How many ways are you riding on or near the line of a “critical state?”

While there is little doubt that the list could be far longer, here are ten of the most important circumstances (many of which are ignored) that could put you at, or beyond, a critical state:

  1. Disability or Loss of Life: whether it be one of the major stakeholders in your business, a member of your family, or one of your employees, this is often the most catastrophic change.
  2. Lack of a Succession Plan: see point #1 above.
  3. Inability to Communicate: with family, partners, employees, vendors, etc.
    Does any more need to be said on this one?
  4. Debts Get Called: sometimes lenders make adjustments to their portfolio to manage their risk. If your debts get called, how do things change for your business?
  5. Overspending: cash in the bank is a good thing. Spending it because it is there is the scourge to many farms’ financial strength. Do you believe cash is king?
  6. Crop Failure: do you have the financial strength to survive a crop failure?
  7. Timing: trying to time the commodity markets is almost like trying to pick winning lottery numbers; both are nearly impossible. Regarding major purchases, there clearly is a right time and a wrong time to be taking on more debt, investing in more or upgraded assets, expanding, etc.
  8. Inaction: not monitoring bins, too cold to haul grain, we’re at the lake (can’t scout for bugs/disease,) etc. Poor excuses that can quickly create a critical state.
  9. Maintaining Inadequate Working Capital: believe it or not, but the chronic dependence on operating credit from lenders and vendors leaves a farm at the precipice of a critical state. Operating credit should not be counted on year over year. What if it isn’t there when you needed it most?
  10. Unwilling to change and adapt: “We’ve always done it this way,” are the 6 most deadly words in business.

Direct Questions

How many of the 10 points above might apply to your farm?

How would you gauge your ability to critically analyze your own business relative to the 10 points above?

What is your strategy to remain “well back” of the line that crosses over into critical state?

From the Home Quarter

In the battle against weather, insects, disease, market prices, etc, it is easy to get caught in a routine. When we succeed at managing through the day to day, the “extra” stuff, the “other” issues seem like they can wait. “It’ll never happen to me” are some of the most famous last words.

Too often, we operate at the very brink of critical state. Too often, we get away with it, which allows to be become “something we’ve always done.” So I’m left to ask,”Isn’t it better to avoid a crisis than deal with one?”

 

ic_leap

Experience: LEAP – – Leadership, Engagement, Authenticity, Passion

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Leap year only comes around every 4 years, so to some people, it’s kind of a big deal; to others, not so much. I will have spent the 2016 leap day by taking part in a unique event, Experience: LEAP.

Experience: LEAP is an initiative of the wonderful people behind Project: SHINE Inc. Their passion is for everyone to live the fullest life possible, to be their true self, and to experience life with passion and purpose. The key message is for everyone to learn that where you are is not where you have to stay. The message applies to us personally, but also has business implications.

In the case of this event, LEAP is an acronym as follows:

Leadership

Leaders are made, they are not born. While some people are born with the characteristics that are often found in great leaders, the fact is leadership skills are learned, and therefore, leaders are made. This has 2 different aspects that apply to your farm:

  1. You are the current leader of your operation.
  2. You need to identify and develop a leader to take your place for when you’re no longer leading the business.

We often learn from experience, or learn from others’ examples, but rarely do farm business owners ever get sat down and taught how to be an effective leader. Everyone in your business will perform in direct correlation to their response to the leadership of the organization. It is like the old saying, “Would you rather be in an army of lions led into battle by a sheep, or be in an army of sheep led into battle by a lion?” If you find yourself questioning the effectiveness of your employee(s), first gauge your effectiveness as a leader.

As a leader, you need clarity in the results you expect in your business, the strategy for achieving those results, and the tactics in execution of the plan. Naturally, sharing this information with your team is critically important in effective leadership.

Engagement

One cannot expect to build a profitable business or an effective team without being engaged. A person who is disconnected and unattached will achieve sub-par results, and find the same in their team. How does one become more engaged? What can be done to increase the engagement of a team? By and large, it begins with purpose. Clarifying the “why,” which means “why are we here; why do we do what we do; why are we the best people for the job?” Clarifying purpose by answering the “why” helps teams, and individuals, recognize that they are a part of something bigger and that they have a key role to play in the organization. By turning a basic employee, a laborer per se, into an engaged and contributing member of a highly functioning team will pay dividends to your business that may astound you.

Authenticity

To be authentic is to be real or genuine. This involves interactions with your staff, your business partners, your family, your vendors, but most importantly with yourself.
I find it curious that authenticity is required for true engagement, which is required for effective leadership. Passion affects everything.

Passion

Passion can be difficult to describe because it is a feeling like few others. Passion can consume you, drive you to heights never imagined, and lead to immeasurable levels of joy or even anxiety. Passion can often create infallible commitment, which, if not balanced with sound rationale in decision making has potential to lead to undesirable outcomes. Unbridled passion sounds poetic and profound, but it can be dangerous if not balanced with reason and objectivity.
Yet, life (or business) with no passion becomes an insufferable task to endure. Most farmers I meet are passionate about their farm, about the land, about growing things, about the family legacy they are living and plan to leave behind. “Life becomes work” if there is no passion. But don’t forget balance, because “work can become life” on the opposite end of that spectrum; neither is desirable.

Direct Questions

How are you gauging the effectiveness of your leadership? (HINT: this isn’t a “self-assessment.”)

What are you doing to match your engagement to that of which you expect from your team?

How would you describe your passion?

From the Home Quarter

Recently, I listened to a presentation where the crowd was polled: If you could sell all your land for 25% above market value today, and rent it back for life at half of current rental rates, how many would take that deal? No one raised their hand. The presenter then acknowledged that no one in the crowd was a farmer, but actually a land owner. Everyone laughed in subtle agreement.
The point is to define your passion, your “Why.” Clarity in what you do, why you do it, and how you do it is no longer something that only applies to large corporations who need that “feel-good mumbo-jumbo” as part of their strategy. Make no mistake, farms of the future will require processes that were once foreign, or only found in corporate cultures. The need for social license becomes greater each day. The need for strong and committed teams becomes greater each year. The need for passionate, authentic, engaged leadership becomes greater with each new generation in the family business.

Daddy Selfie

Additional Family Members

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It is amazing how a family is changed when you add another member to the fold. Whether it be the addition of my new daughter last week (Feb 16 if you want to keep track) and the changes she brings to this household, or the addition of another generation into the family’s farm business, the change is not only imminent, but it can also be drastic, unpredictable, and challenging.

Both situations above involve adding a child, or another child, to what used to be “normal” and “routine.” The similarities don’t end there.

Where Does Everyone Fit?

Bringing another person into the mix creates upheaval. What used to be a shared role could now fall to one person solely. New roles that didn’t exist before now have to be addressed to determine who should fill these roles. This can be stressful, cause tension, and can lead to feelings of inadequacy or inequity.

Can I Understand How This Affects Others, Not Just Me?

We humans, despite being the most intellectually and emotionally intelligent animals on the planet, often struggle with empathy and being able to put ourselves in “someone else’s shoes.” We see ourselves as “up earlier, up later, working harder, taking fewer breaks, taking less personal time, doing more than just the fun jobs, etc.” than our cohorts do. We feel our own plight, get grumpy at our circumstance, and then usually either withdraw or lash out (depending on the individual.) If we were to acknowledge that everyone else in the unit probably felt the same way, we would likely find more patience and understanding for each other and for each other’s quandary.

What Do I Have To Do To Do My Part?

Communicate. Of course, it is much more than just that, but it is critical to communicate with your partners about what you want and what you feel. Most issues in business and personal relationships stem from one or more parties feeling like they haven’t been heard. Being reciprocal is key: if we want to be heard, we must also hear our partners.
Clarifying everyone’s “part” is also important. Assuming that Dad should just keeping doing <insert task here> because he’s just always done it is a recipe for conflict. Does Dad even enjoy that task? Is he actually the best person for that task? Same rationale applies to everyone in the family unit.

Direct Questions

To use an analogy, every person is “rowing their own boat.” What are you doing to ensure that everyone in your family (business or household) is rowing in the same direction?

Change is inevitable, even without adding a new person to your business or family unit. How are you ensuring that you aren’t blaming the arrival of a new person for your stress in the face of change?

There is always positive and negative in every situation. The upheaval and change from adding a new person also brings about great opportunity. What are you doing to identify and leverage all of the opportunities that a new person brings to the fold?

From the Home Quarter

The degree of change that comes with the addition of a new person into your realm is monumental, especially if that person is a little baby who is dependent on you for everything. But as we adjust to our “new normal” and a child becomes less dependent, we are no longer suffering under the weight of anxiety of “how to adjust” and actually have to stop and look back once in a while to truly see how far we’ve all come. By working together with a strategy on how to adjust to the new normal, we can accomplish so much more with far less stress and anxiety.
The same holds true in your family farm business. Whether it be a new employee, or a family member who is joining the farm with ownership aspirations, the same tactic applies. Work together with a strategy in mind on how to adjust to this new normal. You’ll find that this new person is more independent than a new baby. Plus, you’ll actually get some sleep from not having to be up every 3 hours.

On a side note, can anyone tell me how adding one tiny person to a household can more than double the volume of garbage produced by 2 adults and a toddler a week earlier? I can’t rationalize this at all.

blindside

Bad Timing

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I recently spoke with a farm ownership team that needs help. They need help in labor and marketing,
but especially in management. They readily describe all that has gone against them, and quickly list off
all the reasons why they don’t have time to work on the tasks that I propose they tackle. They know I
could help them, but they’re too busy to hire me.

Years ago when I was a bank branch manager, one of the lessons I shared with my staff was “there is a
difference between business and busy-ness.” One will make you money, advance your career, and grow
your wealth. The other just kills the day, eats up precious time, and leaves you feeling empty.
This farm team I speak of is multi-generational. The party with the most at risk has the least control. The
debt has almost become unmanageable. The record keeping is minimal. Management decisions are
fragmented and lacking sufficient foresight. These are not my observations, these are their own
admissions.

The first time we spoke, their financial statements weren’t ready, so it wasn’t the right time. When the
statements were ready, they were seeding, so it wasn’t the right time. Recent follow up finds them with
about a third of their acres left to harvest, so (SURPRISE) it wasn’t the right time.

If we all allowed that thinking to be the rule of law in our lives, we’d never accomplish anything. I would
have never went back to school (attended college at age 25;) I would have never pursued career
advancement; I would have never made the leap from employment to entrepreneurship because there
could always have been an excuse to render it “not the right time.”

Guess what…it’s never “the right time.”

At least that is what we allow ourselves to believe when faced with a task, or an issue that we would
rather not deal with. None of us go shopping for a new canola seed variety in mid-May; we secure that
over the winter. Yet we rarely make a discussion with our accountant a priority until April…because
we’re just too busy?

Managing our respective businesses requires great priority. We take far too much risk in operating a
modern farm to allow our management to be an afterthought, or something that can be put off because
there’s something else to do.

Direct Questions

How often do you permit yourself to be mired in daily tasks and other work to the extent that you
essentially “avoid” the administration and management functions of your business?
How could your business be better if you begin to “make it the right time” to focus on management and
administration?

Is the fear of admitting that help is needed in management your reason for never making it the right
time?

From the Home Quarter

The right time is not when things get tough. The right time is not when the banker is forcing the issue.
The right time is not when there are problems to fix, or a wreck to repair. Preventing a fire is much
easier than fighting one. The right time is now.

When making management a priority it can be daunting to figure out where to look first. Our
proprietary Farm Profit Improvement Program™ takes the guess work out of figuring out where to start
by first providing you with a detailed financial analysis that identifies your danger areas and offers
solutions to mitigate the risks. Call me or email for further details.

GFP FI 2

Managed Risk – Part 5: Inaction

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While there could be many more “parts” to the list of topics that would fall under “Managed Risk,” I’ll
end it this week with one that I believe many people, maybe all people, face each day.
The list of reasons (excuses) we provide to support our decision not to act is virtually endless. They can
be found in the 7 Deadly Sins (pride, envy, sloth) or in almost any self-help book (communication issues,
inequality, stress) or even from psychological therapy (apathy, self-esteem issues, narcissism.)
Here are a few of the most monumental farm issues that are affected by inaction:

Business Structure

I recently took a call from a young man looking for guidance on how to manage the complexity of his
current farm arrangement. He farms with his dad and his brother; all three men have their own
corporation and their own land; one brother farms full time with the dad, the other is part time with offfarm
work. Tracking financial contributions and division of labor are a nightmare, and yet both look like
a cakewalk compared to managing “whose inventory is whose?” They are not happy with the increased
efforts needed to deal with these issues, they all know that there is likely a better way, but no one has
taken a step until the day I spoke with one of the brothers.

In this case, the inaction stems from unawareness: none of the men involved in this family farm had the
knowledge of what, if any, options were available, what questions to ask, or who to even ask for help.
It’s also common for inaction to stem from fear – fear of appearing incompetent by asking a “dumb
question,” fear of making the wrong decision, fear of rocking the boat and hurting the family dynamic.

Family Issues

Family issues challenge most intergenerational farms. There are many varieties, and most are worthy of
a book being written on the topic. Elaine Froese wrote Farming’s In-Law Factor. There should be books
written on “How to Fire Your Father” and “Decoding Motivation: How to Translate Boomers, Gen X’ers,
and Millennials.” If only…

The most common reason for inaction on family issues is “I don’t want to blow up the farm.” The
problem is that inaction can blow up the farm with greater odds than if action was taken! Unless the
family member you’re dealing with has truly sinister motivations, the likelihood of a successful dialogue
is quite positive. No one wants to destroy the farm or the family, so with the appropriate approach,
success can be had. The inaction for family issues predominantly stems from fear. Coaching is available
to help families deal with these types of issues.

Transition

Considering the average age of a Canadian prairie farmer today, the volume of farm transitions to take
place over the next 10 years is staggering. The cumulative value of assets that will change ownership
would dwarf the GDP of some small nations. With so much at stake, why does every farm not have a
succession plan already in place (or at least in progress?)
Inaction on this front increases the risk of the following:

  • Future family fighting
  • Colossal tax obligations
  • Destroy the farm business
  • Your legacy lost

Excuses (reasons) for inaction here are unacceptable. It is nothing short of reckless and irresponsible to
leave undone a function with such enormous impact. There is no shame in not having all the answers, or
any answers for that matter. Farm transition is a process, not a result. The process becomes a path of
discovery, but if you insist on keeping your blinders on, don’t be surprised to one day deal with any or all
of the 4 bullet points above.

Direct Questions

What is your main reason for inaction? “No Time” is an excuse. “Fear” is a real reason, but only you can
conquer it.

What have your accountant and lawyer provided you for advice regarding your future transfer (sale) of
assets?

In a family business, inaction increases the probability of irreparable family dysfunction. What is getting
higher priority: family harmony or fear of perceived conflict?

From the Home Quarter

What must happen to make an issue a priority? Is it an immediate tangible loss/damage, like an
equipment breakdown in season? Is it emotional goal, like a new pickup truck? Is it perceived (assumed)
risk, like assuming your employee will quit unless he’s granted a wage increase?

Making an issue a priority is the best way to beat the risk of inaction. The fear of the perceived
outcomes or the fear of not knowing how to proceed gives us permission to keep urgent issues down
low on the priority list. But at what point does reality and rational reasoning take over so that we
recognize that the risk of inaction has more negative potential than that of any perceived outcome?
In retrospect, “inaction” is not so much a managed risk, but an unmanaged risk. Managing our
“inaction” actually reduces, or even eliminates, the risk.

If you struggle with inaction…
For a no charge consultation on where you are best to replace “fear” with “priority,” please call or email
me anytime.

trees

Knowing Your Costs – Part 3: “The Present vs The Future”

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As a proud member of the Rider Nation, and loyal fan of the entire CFL (despite the goofy new rules for
2015,) I witnessed something happen on the weekend that blew up social media and has fans of the
Green & White frothing.

The struggling winless Riders have been devastated by injury and lack-luster performances on field,
especially defensively. The order of the game plan each week seems to be “who can we plug where?”
One of the criticisms from fans is that there has been inadequate planning on behalf of management to
bring in the right new talent to provide appropriate solutions at time of crisis (like injury.)

While the business of football is a mystery to me, the business of business is not. Like a football team,
your business will face crises and you’ll need to adjust quickly. It doesn’t have to be personnel related
(like a football team;) it could be asset related (like equipment catastrophe) or market related (like a
major price decline) or anything. The knee-jerk reactions that are commonplace during times of crisis
rarely bode well for outcomes.

In the case of my favorite football team, the knee jerk reactions have been to sign different players to
the roster regularly. This is meant to fill the gaps left by injury, unsatisfactory performance, etc. This
knee-jerk reaction creates an air of constant uncertainty among the remaining players, and rarely brings
instant results because new players need time to learn the system, and gel with their teammates so as
to function as a unit when on the field. Wouldn’t it be better to have developed some younger players
and keep them on a practice roster? Players who would have learned the system since training camp,
and who are just itching to get on the field and show their stuff?

Similar to your business when you face crises, you could follow the lead of this football team and simply
run to the marketplace to buy another combine, rent more land, hire more people, apply more spray,
etc. The knee-jerk reaction would feel good in the short term because of the band-aid effect, but what
about the future? How has the knee-jerk decision affected your future profitability? Will the lease or
finance cost of that combine be affordable for the next 2-5 years? Will the extra land grow anything, or
will it be flooded out or ravaged with disease? Will your new hire fit in with your existing team and
culture? Will that extra spray increase or decrease your profit? Wouldn’t it be better to have given these
potential crises some consideration before the season started with some planning? With planning, you
would be prepared and then make a timely and informed decision. No more knee-jerk reactions.

The biggest issue with my favorite football team came to light during the last game this past Sunday. The
head coach pulled a young quarterback from the game after he threw an interception. The young QB,
who is 23 years old and fresh out of college, started the season as 3rd in line yet found himself in the #1
slot for the last number of games because of injury. By all accounts, this young man has the skills to be
the future leader of this team…in several years, not now. He needs time to learn, to enhance his skills
and his knowledge. The best way to enhance those skills is with real life experience. On Sunday, the
head coach regressed that young man’s growth by killing his confidence when he got benched for one
mistake. The coach made a knee-jerk decision that can, and likely will, have a detrimental effect on the
future of the team.

While the future of this football team weighs heavy on the fans enthusiasm right now, your business
doesn’t have to be this way. Whether it be a crisis in personnel, equipment, weather, or markets, the
preparation and planning you put in ahead of time will save you time, anxiety, and money.
How does this relate to knowing your costs? It comes from planning. Knowing your critical crisis cost
points from investing time and effort in your management will clearly indicate where you have
sensitivities and where you have breathing room. The sensitive areas, where your return on investment
is tight, require more strategy analysis to better prepare for crisis.

Critical Crisis Cost Points

Personnel

o Key person quits mid-season (do you have a successor on the team today?)
o Injury, serious or minor (do you have a documented safety plan, insurance coverage?)

Equipment

o Does your current equipment cost per acre have room for an increase should there be
an equipment crisis?
o Is your current equipment line deficient or excessive based on your productivity,
efficiency, and cost expectations?

Weather

o Are you prepared for hail or frost, drought or flood? (i.e. do you have sufficient working
capital to handle the loss of gross margin?)

Markets

o Do you know your Unit Cost of Production so you can hedge for a profit?

Direct Questions

What have you done to prepare for crisis on your farm? Will you be making a prepared and informed
decision or a knee-jerk reaction?

What are you doing to understand your costs on your critical cost points to accelerate your ability to
make informed decisions during times of crisis?

From the Home Quarter

The planning that goes into putting together a successful football season resembles the planning it takes
to put together a successful growing season on your farm. You put together the best game plan you can
based on the assets at your disposal, tangible or intangible. You prepare for quandary by building depth
into your game plan for your critical crisis cost points. Sometimes you best plans aren’t enough;
sometimes the dilemma is greater than you could predict or the results are more damaging than you
could imagine. No matter how you slice it, your best bet is planning and being prepared by drawing the
distinction between risking your future on a quick decision in the present, or taking the charted path
keeping the long term success of your business always in mind.

The head coach of the Riders got fired before I could finish writing this article. I expect it was partly
because he refused to take any accountability for the team’s struggles. He routinely made decisions in
the present with a lack of regard for his, or his team’s, future. He arrogantly stated in interviews that
he’s a great coach and will find work if he’s let go. His unwillingness to look within himself as the leader
ultimately cost him his job. As the leader of your farm, please don’t get caught in that same syndrome.
Your future depends on it.

assets

Avoiding Assumptions About Assets

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“If you’ve inherited an asset, you should act more like the custodian, not the consumer, of that asset.”
I was having coffee with Bill Allen, a Sun Life advisor and friend of mine that I met through CAFA
(Canadian Association of Farm Advisors; great organization, check them out www.cafanet.com) and as
we were discussing business, he used that statement above to illustrate his personal values as they
relate to estate planning. I asked Bill if I could write my next article around this statement, and he
consented.

The farm land that is expected to change hands over the next decade is projected to be somewhere
north of $50 billion (that’s >$50,000,000,000.) Much of the land will be sold (enter the farm land
ownership fray) but much of it will be handed down to the next generation. To the chagrin of farming
children, some of that land might get passed down to their non-farming siblings (enter the farm
succession fray.)

To those who inherit land, think about Bill’s statement above.

If You’re a Farmer…

There is blood in that land; the blood of your ancestors who risked it all to come west for a chance at a
new life. To think that it’s yours to do with as you please is…well, I’ll let you fill in the blank. Now land
that you acquired on your own with your own business savvy, hard work, and some good luck…you can
have at ‘er! It’s mighty short sighted to mortgage your “heritage” land for “personal wants.” What about
your legacy? What about your kids?

If You’re Not a Farmer…

The expectation of a financial windfall from the passing of your parents is simply unacceptable,
especially if you’ve been bequeathed the land that was passed down for generations. It is not yours to
sell to the highest bidder; it is an heirloom that must be cherished and made available for the next
generation again.

When my grandmother immigrated to Canada as a child, some of her older siblings stayed back in the
old country. Their descendants are distant cousins who we had kept in touch with many years ago. I
recall that the “flat” in which they lived was not owned, but was still passed down through generations.
Ownership of their own home, something which we take for granted in Canada, was not realistic for
them at that time in history. And yet what they had, despite unowned, was bequeathed.

When I began farming I promised my dad, who was a recent widower at the time, that I would never
allow the original land to be jeopardized for expansion or otherwise. Now that I’m no longer actively
farming, I can only hope that my siblings who are carrying on will stick to that.

There is a way to minimize the risk of inherited land being sold off: complete a succession plan.
Call it whatever you like: transition plan, continuity plan, longevity plan, whatever! No matter what you
call it, just get started. Getting started is the hardest part, and there is help available to get you started.
You will eventually secede from the farm, and the activity of planning for it will force you to talk to your
family about what they want.

Direct Questions

Does your entire family know what happens to the farm if you were to pass away tomorrow? Ask them.
If their answer doesn’t match yours, then you haven’t done a good job of this.

Do your non-farming children even want to own land? If they don’t, why burden them with it? If your
assumption is “Why wouldn’t they want land,” then talk to them…now.

Can you afford to hand down the land without needing the food bank in retirement?

From the Home Quarter

When I was a kid, the standing joke was “I can’t give my kids the farm; I’ll get charged with child abuse!”
Today, land is a hot and sensitive topic. Over a century of blood, sweat, and tears is awash in homestead
land and to trade it for a fat cheque seems an indescribable tragedy when something as simple as a
conversation with family could circumvent such heartbreak.

Succession isn’t easy. It forces us to consider a future that we may not be ready to face. But ready or
not, the future is near, so it’s best to be prepared.

Whoever said it, this rightly applies: “We do not inherit the earth from our ancestors; we borrow it from
our children.” Sounds like they were having coffee with Bill too.

If you’d like help planning your farm for business and personal success, then call me or send an email.