Thinking about retirement and your legacy of the land

As the sun sets on another taxing day at the farm and you begin to think about the future, do you have a plan for the next steps?
calendar icon 25 January 2021
clock icon 3 minute read

Many farmers nearing or at retirement age spend sleepless nights wondering what their future holds and what would happen to the family farm if they retired. Farming is an occupation that stems far beyond punching a timeclock. Often, it is a committed and lifelong passion that has been passed on from one generation to the next. While thinking about retiring can be difficult, it can also be a chance to consider and plan for how you might enter a new phase of life on your own terms.

Retirement can be far more than the stereotype of sitting in a rocking chair and watching the sunset. It may be a chance to do some of the things you never had time to do because of your seemingly endless list of chores. To others, it might be farming on a smaller scale to remain connected to agriculture. Just like the operation of your individual farm, retirement can look different to everyone. As you begin to explore the possibility of retirement, it is good to consider the following:

Start with what you want. Focus on what you enjoy and begin to build a transition plan around your priorities. Maybe you want to spend time with family, travel or connect with old friends. You can also use the skills you have honed over your career for a related agricultural business, off-farm work, or even for assisting another farm.

Discuss plans with your family. Many times, family members are involved as part of your plans. Your spouse, children and/or other relatives may have important input, or they may be a sounding board as you think through this next phase of life.

Assess your financial situation. Understanding your current finances will help you develop a plan that sets you up for success. Remember that your financial resources may take many forms. These resources include retirement accounts, equity in both your farm and non-farm assets and even expected Social Security benefits.

Determine your family’s financial needs. What are your current family living expenses? How might this change with your potential plans? To better understand what your family will need, it may help to sort expenses into categories. Consider MSU Extension Farm Business Management for additional resources.

Plot your path. Bring together the life changes you identified with your financial situation. Think through the possibilities and know that you are not alone in this process. Your financial professionals can help you sort through the many tools available to tailor your individual plan.

If you find yourself unsure where to turn or what is best for you, you family and the farm while considering retirement, Michigan State University Extension offers support to help ease the burden of these concerns. Michigan State University Extension’s team of Farm Business Management educators can provide retirement planning resources and/or individual consultations. Having a plan for retirement can offer the peace of mind that you are making the best decisions for you so you can enjoy the fruits of your labor.

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