Roadblocks to Successful Farm Transition Planning

As I shared in my presentation to the Idaho Falls Estate Planning Council this week, a successful farm transition plan is one that will: 

• Protect the ongoing viability of the agricultural operation;

• Provide for the orderly transition of the agricultural operation to new ownership; and

• Preserve family harmony.

Unfortunately, even though it sounds relatively straightforward, the odds of success are not great.  Approximately 96% of the 2.2 million farms in the United States are classified as family farms.   However, only 30% of those family farms will transfer successfully to the next generation.  Even fewer will make it beyond that.  

Why is the success rate so low?  In meeting with farm families over the years, several roadblocks to success have been common:

• Procrastination

• Unwilling to Make Hard Decisions

• Failing to Communicate

• Failing to Implement Organizational Structure

• Failing to Prepare the Next Generation

• Failing to Plan for Liquidity in Retirement

• Failing to Plan for Death and/or Incapacity

• Failing to Plan for Long Term Care

As you work to remove these roadblocks while engaging in the four-phase transition planning process, your odds of success will increase dramatically.

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This post is for informational purposes only and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Nothing herein creates an attorney-client relationship between Hallock & Hallock and the reader.