Round Tuits on the Gunnadoo Farm
 
To answer this question, you should ask yourself why are you farming?  The obvious answer is because farming is what you do, or you are farming because you have married a farmer.  Your children who also wish to go farming are no different from yourself; they are not pursuing the vocation purely for the money, but also for the lifestyle. 

So how are you going to comfortably retire and enable the next generation to take over?  It all seems very difficult, but it need not be, provided you approach the transaction from the right angle.

Round Tuits on the Gunnadoo Farm No 2
 
Last month article listed 12 important issues that are so often in the Round Tuit basket on the Gunnadoo Farm Succession Planning.  This month I tackle Personal Goals with Time Framing.  All to often, personal goals are not achieved due to people only working on stage one of what should be a three-stage programme.
The stages are:

Round Tuits on the Gunnadoo Farm No 4
 
Most farmers are workaholics.  This condition is borough about by a variety of conditions and situations including:

1. The very nature of the chosen vocation of farming and your economic situation.  
2. The economics of farming.

Round Tuits on the Gunnadoo Farm No 5

Why is it one of the last entries in a farm budget is personal drawings?  Why is that?  Two days before writing this article I visited and sat round a table with a farmer to discuss his situation.  In gathering information for the initial fact finder he owns three farms and is running a going concern enterprise of $8.4 million with a debt of $1.8 million.  He and his wife are taking drawings of $1200 a month!  He and his wife in partnership own all their assets.  The $8.4 million excluded their personal and household effects and furniture and also excluded their three personal vehicles and their boat that hasn’t been used for five years.

Round Tuits on the Gunnadoo Farm No 6
 
Stress: something we all too some degree at some time suffer from.  Some people handle it much better than others.  People show it to different degrees. It can be the catalyst, to take a sub-clinical condition and turn that condition into a major problem, like a heart condition.  We all know the effects stress can have on animals.  Deer especially.  We all pretty well know what stress is.  It’s the cause I want to deal with. 

Round Tuits on the Gunnadoo Farm No 7
 
How often have you heard the phrase “you are never too old to learn?”  What about “Never confuse opinion with fact ?”  They are however two issues.  Let’s firstly deal with the first one.  Life itself is a never ending process of education continuance.  If we have our eyes wide open and our ears fully on receive we can’t but help to further educate ourselves all the time.  As we are all different we all have different want, needs, desires and aspirations to learn more about a huge range of topics. 

Round Tuits on the Gunnadoo Farm No 8
 
If you put 20 farmers in a room and asked them to firstly define Farm Succession you would get 20 different answers.  If you then asked them to fully explain the process required to successfully achieve Farm Succession you would probably get an odd vacant look, a few shoulder shrugs, some answers that would vary tremendously, and quite a bit of silence.  Firstly you have to know if you want Farm Succession to happen and have plans in place so as it can happen in the future if you want it to.  Don’t worry at this point about how.  There are many things we all don’t know how to do.  In these days of ever increasing specialization you out source to someone who knows how to solve your problem. 

Round Tuits on the Gunnadoo Farm No 9
 
This really can be in two parts, firstly:  
Asset Protection – Family Trusts.  Really the main reason for having your assets in a family trust should be for asset protection.  A family trust should not be actioned purely for taxation reasons.

Round Tuits on the Gunnadoo Farm No 10

You may well ask yourself what would I know about this topic – the answer is not much.  So what to do?  Do what I’ve been saying all along.  When you don’t know much about a topic you need to know about, out source!  I’m going to now practice what I preach and “out source” and have an expert write it. To help me, Gavin Haddon of Cooper Aitken & Partners, Morrinsville has kindly written what follows.  

Round Tuits on the Gunnadoo Farm No 11
 
When: A simple answer NOW.  A flippant comment you may think but basically very true.  Most Kiwis talk about saving when they’ve got some spare cash, when bills are paid, when their income rises, next year or whenever.  They talk about it like that when they’re 20 and are still talking in a similar vein when they’re 50.  Why?  Because Kiwis spend and save what’s left and that’s generally nothing.

Round Tuits on the Gunnadoo Farm No 12
 
For this topic and dealing with farmers probably the best qualified to write this article is someone from one of the worlds largest agribusiness banks.  Paul Rogers, Regional Manager for Rabobank has put down some thoughts for the rural banking situation.  Being part of an industry with significant areas of inherent risk, farmers are often burdened by factors which are beyond their control.