3/15/2021
When your life’s work is your farm, it’s important to consider how to pass that legacy along to the next generation. According to the USDA, family farms account for 96% of farms in the United States today, and 70% of that land will change hands in the next 20 years. Yet in one study, just 49% of Iowa farmers had chosen a successor.
Help your future vision come to life. Our farm succession planning template can help you uncover the decisions you’ll need to make about the fate of your farm and organize your thoughts before putting the plan into action.
The template addresses four key questions in farm succession planning:
Determining who will take over your farm is more complex than determining who you might leave a residential house to. Your heirs aren’t just inheriting land or a building—they’re inheriting a legacy and a business. Some factors to consider include:
Until today, you may have thought of your farm, business, and land as a single entity. Yet, as you plan your succession, it’s important to remember you’re determining the fate of two things: the land that you own and the farm business you operate, along with its assets.
You may determine that your successors will inherit the business and land as a package. Or you may have heirs that inherit the farm business, while others receive property as an inheritance. Also consider if you’ll want to take a portion of the land for your own use after retirement.
Consider the following questions:
Timing is important in succession planning, as it determines exactly when your plan will be put into action. Do you want to set up a phased transition that leads up to retirement? Or would you prefer to work until a specific date and then step away? You should also consider including a caveat that triggers your plan early in case unexpected, life-altering events occur.
As part of your timing considerations, think about whether you want to mentor your successor(s), particularly if they aren't already working on the farm. For example, if the next generation has a full growing season to work with you before assuming control, then you’re sharing your knowledge as part of your larger legacy. Your heirs' current professional or family responsibilities and future plans may need to be considered when developing realistic timelines.
With the “who, what, and when” established, formalize the plan with the help of professionals who can make your ideas into reality. Consult with advisors like appraisers, lawyers, and accountants to develop a financial strategy and write contracts for your succession plan.
Questions you may answer with these experts include:
Once your plan is established, take the time to periodically review and adjust based on your current reality. You may decide to change an heir or retire earlier; make sure these adjustments are reflected in official paperwork.
Need help filling out your template? Check out these additional resources for more guidance:
Prepare for tomorrow, today by taking the steps to document your farm succession plan.
Start planning for the future now with our free template.
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Learn the potential issues to watch for during farm succession planning and who to involve.
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Visit Corn Herbicides HQThe information provided herein is provided gratis, and solely as reference. The information is not intended to be, nor shall it be a farmer's sole and exclusive source of information on the subject matter. Corteva Agriscience makes no warranty, or other representation, express or implied, as to the accuracy of any information contained herein, and cannot assume responsibility or liability for reliance on or use of this information by any farmer in making specific decisions on succession planning, which in all cases is the responsibility of the farmer.
