Succession Planning: Separating business of farming and personal wealth
Separating the business of farming from personal wealth when it comes to succession and estate planning is key, according to one consultant who deals with dozens of cases of farm succession and estate planning every year.
Merle Good is the President of GRS Consulting based out of Olds, Alberta
He says there are always hard questions that need to be answered, adding that farmers are in a unique position, when it comes to planning for the future.
Good says land is almost always one of the biggest factors when you first sit down to start figuring out how you are going to roll it over to the next generation.
He says it is usually the first question out of farmer’s mouths when they sit down at the kitchen table.
“I have a large land base, perhaps not that many acres, but even if you don’t have that many acres, there’s such a large value in land today and so every farmer has this large, large land base of wealth,” said Good.
He says then comes the question of how many people are sharing in what is being passed on when they do the estate plan.
“They have maybe one, maybe two children back on the farm, maybe two or three children off the farm, what’s fair, equal, equitable?”
Good says the main take-home whenever you are talking about succession and estate planning is that you have to separate the business of farming from personal wealth.
“I sit down with them at the kitchen table and say let’s make sure we have a clear and a very good understanding of the operational structure and then we’ll leave the estate planning off to the side. So let’s make sure we have clarity of roles, responsibilities, compensation on operating the business itself.”
Merle Good presented at the Advancing Women in Agriculture West conference in Calgary in March.
For more information on the Advancing Women in Agriculture Conference and to register for Advancing Women East click on the banner.
Here is the full interview with Merle Good: