Estate Planning: Transferring More Than Just the Estate
Farm Business Management Update, April 2002
By Daniel Osborne
You as a farmer probably think you have done pretty good job when you figured out a plan for passing on the family farm to your children without having to pay estate taxes or break up the farm. Indeed, you have done a pretty good job, but you have more to think about. Your children need to know what to do with the farm once they get it. Thus, you need to consider how to pass on your farming knowledge and expertise to your children in addition to the farm itself.
The average farmer transfers his knowledge and expertise to the children by making the children work on the farm. He says to the children, "Do this . . . and do that," and the children listen; well, sometimes. But what would happen if the parents were not around? Would the children know what, when, and how to do the work and manage the farm? To find out, take a few days off, and see what happens. If your animals are starving and your crops withered away, you need to spend some time transferring your knowledge and expertise.
A few suggestions that might be helpful include:
Of course, some farmers are naturally better than others at passing on their knowledge and expertise to their children. But if you heed these suggestions, you will be taking actions that will increase your children's likelihood of operating a successful farming operation once you are gone. But most of all, take time to think of how you can transfer your knowledge and expertise to your children. Just maybe the costly lessons you had to learn will not have to be learned twice.
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