How to Plan Your Farm’s Future with Confidence

As you prepare for the next chapter, it’s essential to approach your farm estate plan with a clear, intentional strategy—one that balances your financial security with your vision for the legacy you’ll leave behind. Comprehensive wealth planning should serve both your near-term needs and your long-term objectives, ensuring that you’re well-positioned for retirement while also preserving your family’s heritage. Here, we’ll explore practical steps to help you accomplish these goals with confidence.

Evaluate what to transition or sell

An early step in the process is to thoughtfully review the assets you hold and determine which are essential for your ongoing legacy and which could be liquidated to support your retirement or other priorities. For example, you might consider marketing stored crops gradually to manage the tax impact or thoughtfully divesting surplus equipment and land assets. For equipment, installment sales or contracts-for-deed can help spread out income and taxes, while excess land might be sold or even retained for rental income, depending on your goals. Collaborating with an experienced agricultural banker can help you weigh your options and make decisions that align with your broader strategy.

Craft a purposeful estate plan

From a legacy perspective, clarity is key. A well-designed estate plan can smooth the transition process and minimize confusion for your loved ones. If you have multiple children, it’s important to consider whether an equal or equitable distribution of your assets best reflects your values and your family’s circumstances. For some, an equal split of farmland and other assets makes sense, particularly if multiple children plan to remain involved in the operation. For others, a more tailored approach—such as passing land to a child actively engaged in the farm and dividing other assets among siblings—may feel more appropriate. There’s no one-size-fits-all answer but spending time refining and articulating your goals can help make the decision clearer to see and easier to implement.

Once you’ve identified how you would like your estate to pass, you’ll want to select the estate planning instrument(s) that fits best—typically a will or a trust. Each has key distinctions: wills go into effect after your passing and require probate, while trusts take effect immediately and often serve to bypass the probate process. Trusts also offer flexibility, coming in both revocable and irrevocable forms, and can be especially beneficial for those seeking to keep land in the family and retain control over asset management during their lifetime. Engaging a knowledgeable wealth advisor can help you navigate these choices and design a plan that supports your long-term vision for your family and your operation.