This is the fourth and final installment in my family ranching series, where I have focused on preparing for emergencies, managing money expectations in the family business and tips for estate planning. This week, I want to expand on estate planning with these 10 do’s and don’ts for families beginning the tough and numerous conversations about establishing a succession plan.
When planning my four-part family ranching series, I wanted to zero in on common problems ranchers need to navigate to keep the business thriving and the family intact. By far, the biggest hurdle families face is putting together an estate plan.
In case you missed the previous three installments, check them out here:
According to a report from University of Wyoming Extension and the Wyoming Agriculture & Natural Resource Mediation Program, nearly 30% of farm, ranch and rural business owners do not know what will happen to their operations when they retire. Even worse, only 1% of family-owned farm and ranch businesses in North America are transferred to a third generation, and 30% of all family-owned farm and ranch businesses have not considered a successor. A whopping 58% of farm and ranch business owners say inadequate succession planning is the biggest threat facing their business.
So why do ranchers avoid estate planning like the plague? According to the report, the topic of estate planning is often avoided because ranch families may not be ready to think about the issues regarding people, property, taxes, laws, and the subsequent costs of putting a plan in place.
I recently ran across an article in the Journal of Extension titled, “Some do’s and don’ts for successful farm and ranch estate planning.” Although the article is a bit dated, the tips remain quite relevant.
Here are 10 ways to sabotage family estate transfer plans:
1. Procrastinate. Don't write a will or transfer plan. Let the children worry about it after you're gone.
2. Avoid planning or making decisions.
3. Don’t discuss the subject of estate transfer. Keep information from younger family members. This is a sure way to increase family conflict.
4. Blame others for problems. Stay angry.
5. Do all you can to block the younger generation from any involvement in goal setting or decision making until they are middle aged.
6. Refuse to listen to other family members' viewpoints.
7. Hold on to total control of the family business.
8. Assume others know what you want. Avoid discussing your wishes about transfer with family members.
9. Make sure all your sense of worth, your identity, and life's meaning come solely from the business. Resist transferring to the next generation. This way they have the least influence and the most stress.
10. Pay no attention to wake-up calls like a farm/ranch accident, illness, death, or major choice point by an offspring.
These tips not only apply to estate planning but are also relevant to how we communicate with one another on the ranch, as well. Do you have an estate plan in place? Do any of the 10 things sound familiar? Share your stories in the comments section below.
Be sure to keep tuning in to June’s series on cattle nutrition. Each Thursday, I will focus on the various ways to keep your cows, calves and bulls healthy during the summer months.
By the way, in April I wrote a five-part grazing series. In case you missed it, here are the links to each installment in the series.
The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Penton Agriculture.
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