Harvest is upon us, and with cooperative weather!
Harvest ride-alongs are fun times to visit with farmers. This year, after some serious weather adversity in parts of our state, the first fall crop yields are coming in at or slightly above averages – good news in a low price environment to be sure.
Quickly in these visits, talk turns to plans for next year. Questions on reducing income tax liability while limiting capital purchasing, budgeting for buying a neighbor's land, building a heifer barn, or installing drain tile are just a sampling of what I have heard.
Part of the conversation is always price risk and production risk. There are other risks, which perhaps don't always stay on my radar for customer conversations the way they should. They are risks that no one believes will ever happen to them. A lifelong financial adviser put it quite well: "Yes, I know that you will live forever. The question is, what sort of life do you want for your family if you don't?"
- What accessible cash exists for your family and your farm partners or employees to use tomorrow without you?
- Is the property insurance truly adequate to cover replacing machinery, buildings, and cattle?
- Review that property insurance coverage to make sure the tractor trade from earlier this year got added.
- Does your health insurance cover farm accidents?
- Make updating both your personal and farm business wills part of your winter routine.
- The owner's 25-year-old niece is starting to get serious about getting ownership in the farm in a couple years? Now is a great time to establish some life insurance!
- There is a key person who keeps harvest running like clockwork? Great! Does the farm carry disability coverage for him or her?
While these conversations may not always be comfortable, they get everyone thinking about not just running the farm for today, but for setting up sustainability for generations to come. The benefits reaped from thinking long-term, across the generations, are what maintains and creates century farms.
For many of us who split time between our bank roles and helping our families with their own harvests, best wishes to you and yours for a bountiful and safe season.
I look forward to seeing some of you at our upcoming events:
1) Lunch with Eric Snodgrass and Jackson Takach October 6th at World Dairy Expo
2) ABA Ag Bankers Conference in Milwaukee this November
Spots are still available for both!
Condon is Vice President, BMO Harris Bank, N.A., Watertown