What does the future hold for your farm? Through 2020, I have had many young farmers reach out looking for tips to get their parents to talk about the plan to pass along the business. Farm family coach Elaine Froese has 14 tips to get the conversation started.

Elaine Froese has coached many farm families on the “undiscussabull” challenges, including income, housing and fairness to non-farm heirs, as they relate to succession planning.

How to Start the Succession Planning Conversation

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Farm families are stuck when it comes to getting folks to the kitchen table to talk about timelines for transition of labour, management and ownership of the farm. Over the past six months of the Great Pause, I have had many young farmers reach out to me looking for tips to get their parents to talk about what the future holds for generation one and generation two.

 

Procrastination and conflict avoidance are often the root of the issue for farm families being stuck. Here are my tips to get the conversation started.

  1. Act. Decide that you are no longer avoiding the tough conversations. Are you willing to be the driver to call the family together to meet? The first step is to decide that you will no longer accept silence from your parents or siblings. Listen to Dr. Henry Cloud’s audio book on Boundaries, and his book Necessary Endings. Both are powerful motivators.
  2. Think. Talk to yourself first about what you really want. Then check out the same issues with your spouse. If parents are not in agreement as to what they each want for future roles on the farm, then you will have to work hard to negotiate a more workable vision for generation one. Be clear about your intent. Understand why this is so important for you to get talking and discovering your future now. Complete this sentence for yourself: “My intention is….”
  3. Ask more powerful questions to kick-start the conversation. Ask your parents, “Do you remember what it felt like when you first owned land?” Then add something like, “I am curious if we could sit down and explore ideas on how I can get some equity before April 2021 on this farm. I want to be more than an employee.” Dates are targets to aim for. Certainty of agreements and timelines is what you really want.
  4. Document. COVID-19 has been a reality check for the farmer who said, “Elaine if I get sick and die, the farm will be in chaos.” Get a will, an enduring power of attorney, and guardians for your children. Make sure your executor is fully informed. As you go through the succession planning journey, you will change the estate plan (your will), but get a will now! Lawyers can work with you virtually, and witnesses can sign digitally.
  5. Be curious. Stop telling yourself that is “disrespectful to your parents” or that it is greedy to ask for what you need for your young family. Come from a position of “I am curious Dad, how do you want your role to change on this farm as you age? I am seeking a way to build my own equity. What are you needing?”
  6. Face fears. Address the bull in the middle of the room, what I call the “undiscussabull”. Parents are afraid of failure, loss of wealth, conflict with the non-farm heirs, and loss of identity or purpose as they age. Love does not read minds, so ask gently and graciously “What is hard for you to talk about? I am here to listen and understand.” Watch “Finding Fairness in Farm Transition” on my Youtube channel as a great discussion starter. Download the “Key Challenges” part of the Farm Family Toolkit at elainefroese.com.
  7. Collect data. Know what you need for family living, and where your income streams are coming from. Have financial transparency between the generations. Share the amount of debt you are willing to service or transfer to the next generation. Do understand how much debt you are willing to sleep with, and what you are willing to buy out. Some assets will be gifted, but young farmers need to be clear about how much debt they can service. Have your accountant, lender or farm business adviser confirm the viability of the operation, knowing cash flow, and the number of families the farm can support.
  8. Prepare your ideal business plan for the farm. What is your vision? On our farm, generation one wants to slow down but still be active in the decision making process, and generation two wants to build more efficient systems.
  9. Explore “what if?” What if we block time once a month for two hours to talk about our succession journey? Stress the importance and benefits to all generations. David Kohl’s research showed that farms with regular meetings were 21 per cent more profitable.
  10. Meet. If the thought of meeting scares you, then hire a third party facilitator to prepare each person for the meeting. In 2020, these meetings are done on Zoom. Advisers have seen many creative solutions, and they can keep the conversation safe and respectful.
  11. Buy a flipchart, and find a stuffie toy. You need a visual spot to land ideas and process thoughts. The toy is your talking stick for folks to speak at the meeting without interruption. Record notes and action steps on the flipchart, and use smart phones to capture the pages when the meeting ends. Simple? Yes. Life-changing? Yes!
  12. Explore residence options. Housing is a big source of conflict. Promises are made to switch houses, then things change or a sibling comes to live close to generation one. Be really clear that you understand the timelines and expectations for the residence needs of all generations. If mom wants to move and dad wants to stay put things will be stuck for a long time.
  13. Copy success. Conflict resolution is a business risk management strategy. Share the stories of good transitions. Know that you are not alone in your current struggle, and that the hard work is worth the reward of a workable succession plan to create certainty for everyone’s future.
  14. Build your binder. Or use Google documents to organize the many plans you need to talk about: lifestyle income, legal, accounting, meeting action plans, business plans, coaching communication, estate, loans, etc. I have created a “Life” binder with passwords info, and Maggie Van Camp’s “Because I love you” list. The binder is a great place to jot down your dreams, thoughts and frustrations as you create solutions for the life you’ve always wanted on your farm. Email me at elaine@elainefroese.com for binder tabs, and the “Because I love you” list.

In conclusion, three big questions in farm succession are about income streams, housing and fairness to non-farm heirs. Getting insight on those questions will keep your succession planning going. Remember, it is a journey. I am here to help. Talking is the work.