What’s the Future of Your Ranch?
If transferring the ranch to the next generation is a goal, now is the time to start planning.
MITCHELL, Neb. (Nov. 19, 2019) — It’s an inconvenient truth: Everyone will die someday. Very few people want to talk about that eventuality, and that may be especially true for many farmers and ranchers. Most of them devote their lives to building up an operation, or building upon an operation handed down from previous generations. The land and livestock — the family business — [are part of their legacy. And most probably recognize the wisdom of preparing a will and completing an estate and transition plan ... someday.
In matters such as these, however, procrastination can be folly. Ranchers need to think about the future of their ranching operation and what they want to happen to it after they are gone. Do they expect a next generation to take the reins? How will that be accomplished? If ranchers haven’t really pondered those questions yet, they should not wait.
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“It’s not only about planning for what you want to happen to your ranch; it’s also about protecting it from things you don’t want to happen, like a forced sale to pay nursing home costs or a family divided over how to settle an estate,” said Nebraska Grazing Lands Coalition Ranch Transition Task Manager Bethany Johnston. |
That was the message Nebraska Grazing Lands Coalition Ranch Transition Task Manager Bethany Johnston shared during the 26th Range Beef Cow Symposium hosted Nov. 18-20 in Mitchell, Neb. She urged an audience composed largely of ranchers to act now, offering food for thought to those beginning the estate and transition planning process.
“It’s not only about planning for what you want to happen to your ranch; it’s also about protecting it from things you don’t want to happen, like a forced sale to pay nursing home costs or a family divided over how to settle an estate,” said Johnston.
“Ranchers also need to remember the golden rule, but it’s not the same one you learned in Sunday School. In this case it’s whoever has the gold makes the rules,” added Johnston, emphasizing that ranchers do not owe their children an inheritance, but they should feel obligated to provide their children with a plan.
That doesn’t mean children or other potential heirs should not be involved in the senior generation’s planning process. This may be especially true when planning how to divide an estate among heirs that include one or more grown children who became actively involved in a ranch’s operation and other siblings who sought other careers. Parents and off-ranch siblings ought to consider that dividing the ranch equally among heirs won’t recognize an on-ranch sibling’s sweat equity. When such a person has invested years in helping build up the ranch, equal may not be fair.
Johnston advised the audience to recruit a team of advisors to help with estate and transition planning. Since a lawyer will be needed to complete the process anyway, she recommended finding one well-versed in estate planning and tax law. Other useful advisory team members might include a certified public accountant, an insurance expert and a financial planner. Depending on family dynamics, a mediator may become a valuable member of the team.
Johnston said the Nebraska Grazing Lands Coalition is just one source of assistance with generational transition planning. A list of potential resources is provided in the Range Beef Cow Symposium proceedings.
Listen to Johnston’s presentation, view her PowerPoint and read the proceedings accompanying her presentation in the Newsroom at www.rangebeefcow.com.
The Range Beef Cow Symposium XXVI was hosted Nov. 18-20 at the Mitchell Events Center at the Scotts Bluff County Fairgrounds, Mitchell, Neb. Sponsored by the Cooperative Extension Service and animal science departments of the University of Wyoming, South Dakota State University, Colorado State University and the University of Nebraska, the biennial symposium offers an educational program geared toward ranching in the West.
Angus Media provides online coverage of the event at www.rangebeefcow.com, courtesy of sponsorship by Leachman Cattle of Colorado. Visit the site Newsroom for summaries of the sessions, proceedings and PowerPoint presentations provided by the speakers, and audio if available. For more information about the website, contact the editorial team at 816-383-5200.
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Angus Media's coverage of the event is made possible through collaboration with the event committee and via sponsorship of Leachman Cattle of Colorado. For questions about this site, or to notify us of broken links, click here. Look for additional coverage in the Angus Journal, the Angus Beef Bulletin, the Angus Journal Daily, and the Angus Beef Bulletin EXTRA.
